This work presents a series of numerical modeling studies that investigate the hydrogeologic conditions required to form capillary barriers and the effect that capillary barriers have on fluid flow and tracer transport processes in the unsaturated fractured rock of Yucca Mountain, Nevada, a potential site for storing high-level radioactive waste. The modeling approach is based on a dual-continuum formulation of coupled multiphase fluid and tracer transport through fractured porous rock. The numerical modeling results showed that effective capillary barriers can develop where both matrix and fracture capillary gradients tend to move water upward. Under the current hydrogeologic conceptualization of Yucca Mountain, strong capillary barrier effects exist for diverting a significant amount of moisture flow through the relatively shallow Paintbrush nonwelded unit, with major faults observed at the site serving as major downward pathways for laterally diverted percolation fluxes. In addition, we used observed field liquid saturation and goechemical isotopic data to check model results and found consistent agreement.