Carbon monoxide was measured in C/1996 B2 (Hyakutake) on four preperihelion dates, UT 1996 March 24.5 and April 10.2--12.2, using CSHELL at the NASA Infrared Telescope Facility on Mauna Kea, Hawaii. These observations provided the first secure ground-based detection of cometary CO at infrared wavelengths. The rotational temperatures retrieved for CO are consistent with a heliocentric dependence Trot = 63 Rh-1.06 K over the range Rh = 1.06--0.64 AU. From long-slit analysis we distinguish native and distributed sources of CO, and we infer the relative abundance of native to total CO to be 0.773 ¿ 0.054 on April 12.2. If this ratio is constant on UT April 11.2 and 12.2, the mean mixing ratios (relative to water) are 0.149 ¿ 0.019 for native CO and 0.191 ¿ 0.022 for the sum of native and extended sources. These mixing ratios are based on direct measurements of H2O made on the same dates with the same instrument and analyzed with the same data processing algorithms. The observed spatial scale for complete development of the extended source on UT 1996 April 12.2 was consistent with that observed for C/1995 O1 (Hale-Bopp) on UT 1997 January 21, after taking into account differences in outflow velocity and heliocentric distance assuming insolation-limited release. This may suggest similar progenitor material in these two comets.