Analysis of unsaturated flow and transport in arid regions is important, not only in water resource evaluation but in contaminant transport as well, particularly in siting waste disposal facilities and in remediating contaminated sites. The water fluxes under consideration have a magnitude close to the errors inherent in measuring or in calculating these water fluxes, which makes it difficult to resolve basic issues such as direction and rate of water movement and controls on unsaturated flow. The purpose of this paper is to review these issues on the basis of unsaturated zone studies in arid settings. Because individual techniques for estimating water fluxes in the unsaturated zone have limitations, a variety of physical measurements and environmental tracers should be used to provide multiple, independent lines of evidence to quantify flow and transport in arid regions. The direction and rate of water flow are affected not only by hydraulic head gradients but also by temperature and air pressure gradients. The similarity of water fluxes in a variety of settings in the southwestern United States indicates that vegetative cover may be one of the primary controls on the magnitude of water flow in the unsaturated zone; however, our understanding of the role of plants is limited. Most unsaturated flow in arid systems is focused beneath topographic depressions, and diffuse flow is limited. Thick unsaturated sections and low water fluxes typical of many arid regions result in preservation of paleoclimatic variations in water flux and suggest that deep vadose zones may be out of equilibrium with current climate. Whereas water movement along preferred pathways is common in humid sites, field studies that demonstrate preferential flow are restricted mostly to fractured rocks and root zones in arid regions. Results of field studies of preferential flow in humid sites, generally restricted to the upper 1--2 m because of shallow water tables, cannot be applied readily to thick vadose zones in arid regions.¿ 1997 American Geophysical Union