We propose that the heavily bombarded Martian crust generally consists of a 10-km-thick zone of highly permeable, fractured basement rock overlain by a 1- to 2-km-thick, relatively impermeable ejecta zone. Seismic, drill core, and observational measurements of terrestrial impact and explosion craters demonstrate that the subjacent rocks are intensely fractured into meter-sized (or larger) blocks. Gravity measurements over terrestrial and lunar craters indicate that bulking of a few percent occurred in the upper few kilometers of the underlying bedrock. These measurements suggest that fractured Martian basement rocks may have an open fracture porosity of about 1% and permeabilities of at least 103 darcies; these values would decrease with depth due to decreasing fracture intensity and increasing lithostatic pressure. Theoretical impact fragmentation and mixing models and laboratory and field studies indicate that impact ejecta are composed of well-mixed, poorly sorted clasts that follow power law distributions. On the basis of these distributions, packing theory, experimental relations, and measurements on analogous materials, we estimate that the average porosity of unaltered ejecta within the ejecta zone is 10--20% and their maximum permeability is about 10-2 darcy. Subsequent alteration of ejecta by cementation and compression may reduce porosity and permeability, whereas local fracturing may increase them. Comminution may produce an abundance of clay-sized material that may effectively retain water or ice and increase ground ice retention in equatorial areas. Our model is consistent with observed 1- to3-km-deep mechanical discontinuities in the Martian crust and the susceptibility to erosion of unconsolidated ejecta by sapping and other processes. We further propose that debris flows made up of ejecta and followed by catastrophic floods may explain the development of Chryse region outflow channels with much less water than was required by flooding alone. ¿ American Geophysical Union 1989