The scheduled 12-round super middleweight fight started off slow as Kelly maintained his distance and waited for Munguia to attack, a strategy he continued throughout the fight.
Happy to be the aggressor, Munguia - a former world champion at 154lbs - landed strong power punches as Kelly tried and often failed to counter.
By the fifth round, Kelly, desperate, began a display of holding; Munguia attacked, dropping him three times to be declared the winner by knock-out at the 2:57 marker.
"It was difficult in the beginning since he's a slippery, tough fighter, and he could take a punch," said Jaime Munguia.
"He was trying to do his plan of attack, but I had to do my thing and work the body. My mentality was that I was losing the first three rounds. So I had to follow my plan of slowing him down by attacking the body.
"I figured out that I had to work through the middle and throw punches like the uppercut. I think it was the punch that I knocked him down with."
Munguia continued: "I think this fight helped me out a lot. I'm ready to go back to 160 to fight for a world title or move to 168.
"I'm ready for any challenge. There are a lot of people who are supporting me. I want to say what Oscar said for Charlo to grow some balls and stop hiding behind Haymon. I think it would be great for boxing. We hope that by the end of the year we can get a big fight."
"My strategy was to move and try to frustrate him," said Jimmy Kelly. "He's a strong, patient fighter. But, he just stayed calm and found the opportunity. It was my daughter's birthday and I missed it which broke my heart. I thought I would win but now I have to go back and explain why I lost."
Duarte overcomes test
The pride of Chihuahua, Oscar Duarte (23-1-1, 18 KOs), returned to fight in the US for the first time since 2019 against Mark "Machete" Bernaldez (23-6, 17 KOs) of Cotabato, the Philippines.
The 10-round co-main event was a crowd pleaser as fighters willingly exchanged blows. However, Duarte proved to have more power as he knocked out Bernaldez at 2:05 of the fifth round.
"It was a tougher fight than I expected," said Oscar Duarte. "I followed my team's plan and got the results I was looking for.
My opponent was very resilient, he took a lot of my shots but I stopped him in the end. I look forward to fighting more this year. Thank you to everyone who supported me."
IBF minimumweight world champion Yokasta "Yoka" Valle (25-2, 9 KOs) of San Jose, Costa Rica, successfully defended her world title for the fifth time in spectacular fashion when she defeated Los Angeles' Lorraine Villalobos (5-4, 2 KOs).
Valle was relentless the 10-round fight winning all rounds with three scores of (100-90) via unanimous decision.
"I feel very excited to be defending my title in my US debut on the great platform DAZN," said Yokasta Valle.
"Thank you to everyone that supported me; I'm representing all Latinos tonight. [The fight] was last minute for me as well, but like a true champion, you have to be ready.
"What I've always said is that I want to fight against all the other champions. I want to unify even if it's against Seniesa [Estrada]. I want to fight all the champions."
Upset win for Ortiz
Carlos Ortiz (13-5, 13 KOs) of Torreon, Mexico, put on a great performance and scored an upset victory against Evan Sanchez (11-1, 6 KOs) of Parlier, CA.
The fighters went toe-to-toe in their 8-round super welterweight event, but the fight didn't go the distance.
The fighters were exchanging blows when Sanchez got caught and Ortiz put the pressure on, dropping Sanchez on the canvas and ending the fight at the 2:59 marker; winning the fight via knock-out.
"I feel extremely happy and proud of my team," said Carlos Ortiz.
"I never imagined winning that way. I have no words to explain how happy I am. I'm not going to retire, I'm going to continue.
My plan was to be smart, get in the inside and make sure I take him to the ropes. He would throw a hook, I would throw mine and that's how I got him.
"I knew he was courageous and I knew he was going to go toe-to-toe with me but I was the stronger fighter tonight. Thank you! I will be here for a while. Long live Mexico!"