We seek a better understanding of the distribution of subsurface ice on Mars, based on the physical processes governing the exchange of vapor between the atmosphere and the subsurface. Ground ice is expected down to ~49¿ latitude and lower latitudes at poleward facing slopes. The diffusivity of the regolith also leads to seasonal accumulation of atmospherically derived frost at latitudes poleward of ~30¿. The burial depths and zonally averaged boundaries of subsurface ice observed from neutron emission are consistent with model predictions for ground ice in equilibrium with the observed abundance of atmospheric water vapor. Longitudinal variations in ice distribution are due mainly to thermal inertia and are more pronounced in the observations than in the model. These relations support the notion that the ground ice has at least partially adjusted to the atmospheric water vapor content or is atmospherically derived. Changes in albedo can rapidly alter the equilibrium depth to the ice, creating sources or sinks of atmospheric H2O while the ground ice is continuously evolving toward a changing equilibrium. At steady state humidity and temperature oscillations, the net flux of vapor is uninhibited by adsorption. The occurrence of temporary frost is characterized by the isosteric enthalpy of adsorption.