The SARS-CoV-2 infection causes severe respiratory involvement (COVID-19) in 5-20% of patients through initial immune derangement, followed by intense cytokine production and vascular leakage. Evidence of immune involvement point to the participation of T, B, and NK cells in the lack of control of virus replication leading to COVID-19. NK cells contribute to early phases of virus control and to the regulation of adaptive responses. The precise mechanism of NK cell dysregulation is poorly understood, with little information on tissue margination or turnover. We investigated these aspects by multiparameter flow cytometry in a cohort of 28 patients hospitalized with early COVID-19. Relevant decreases in CD56brightCD16+/- NK subsets were detected, with a shift of circulating NK cells toward more mature CD56dimCD16+KIR+NKG2A+ and "memory" KIR+CD57+CD85j+ cells with increased inhibitory NKG2A and KIR molecules. Impaired cytotoxicity and IFN-γ production were associated with conserved expression of natural cytotoxicity receptors and perforin. Moreover, intense NK cell activation with increased HLA-DR and CD69 expression was associated with the circulation of CD69+CD103+ CXCR6+ tissue-resident NK cells and of CD34+DNAM-1brightCXCR4+ inflammatory precursors to mature functional NK cells. Severe disease trajectories were directly associated with the proportion of CD34+DNAM-1brightCXCR4+ precursors and inversely associated with the proportion of NKG2D+ and of CD103+ NK cells. Intense NK cell activation and trafficking to and from tissues occurs early in COVID-19, and is associated with subsequent disease progression, providing an insight into the mechanism of clinical deterioration. Strategies to positively manipulate tissue-resident NK cell responses may provide advantages to future therapeutic and vaccine approaches.