To clarify the mechanisms of N2O production and consumption in a humid temperate forest, we measured concentrations of gaseous N2O in unsaturated soil and dissolved N2O in groundwater in a forested headwater catchment. We especially focused on the hydrological controls on supplies of electron donors and acceptors for nitrification and denitrification, and their effects on N2O production and consumption. N2O concentrations were higher in the groundwater (0.6--148.0 times higher than water equilibrated with atmospheric N2O) than in the soil gas (1.0--5.4 times higher than atmospheric N2O), suggesting that N2O was mainly produced in the groundwater. Moreover, N2O production was greatest at the periphery of the groundwater body where both DOC and NO3- were readily available from shallower soils upstream. In contrast, N2O was reduced to N2 in the deeper layer of the groundwater body where DO and NO3- were not readily available. N2O concentrations in the unsaturated soil layer were remarkably low despite high N2O concentrations in the groundwater. N2O flux from the spring out point was about 100 times higher than at any other observation site, and there was a decrease in dissolved N2O concentrations from springwater to streamwater. This indicates that N2O produced in the groundwater body did not readily diffuse into the unsaturated soil layer above the groundwater surface, but was transported by groundwater flow to the spring out point and then emitted into the atmosphere, implying the possible mechanism of N2O production, consumption and emission in forested catchments.