Individuals of large or dark-colored ectothermic species often have a higher reproduction and activity than small or light-colored ones. However, investments into body size or darker colors should negatively affect the fitness of individuals as they increase their growth and maintenance costs. Thus, it is unlikely that morphological traits directly affect species' distribution and abundance. Yet, this simplification is frequently made in trait-based ecological analyses. Here, we integrated the energy allocation strategies of species into an ecophysiological framework to explore the mechanisms that link species' morphological traits and population dynamics. We hypothesized that the effects of morphological traits on species’ distribution and abundance are not direct but mediated by components of the energy budget and that species can allocate more energy towards dispersal and reproduction if they compensate their energetic costs by reducing mobility costs or increasing energy uptake. To classify species' energy allocation strategies, we used easily measured proxies for the mobility costs and energy uptake of butterflies that can be also applied to other taxa. We demonstrated that contrasting effects of morphological traits on distribution and abundance of butterfly species offset each other when species' energy allocation strategies are not taken into account. Larger and darker butterfly species had wider distributions and were more abundant if they compensated the investment into body size and color darkness (i.e. melanin) by reducing their mobility costs or increasing energy uptake. Adults of darker species were more mobile and foraged less compared to lighter colored ones, if an investment into melanin was indirectly compensated via a size-dependent reduction of mobility costs or increase of energy uptake. Our results indicate that differences in the energy allocations strategies of species account for a considerable part of the variation in species' distribution and abundance that is left unexplained by morphological traits alone and ignoring these differences can lead to false mechanistic conclusions. Therefore, our findings highlight the potential of integrating proxies for species' energy allocation strategies into trait-based models not only for understanding the physiological mechanisms underlying variation in species' distribution and abundance, but also for improving predictions of the population dynamics of species.