This paper explores the behaviour and sensitivity of a watershed model used for simulating lateral soil water redistribution and runoff production. In applications such as modelling the effects of land-use change in small headwater catchments, interactions between soil moisture, runoff and ecological processes are important. Because climate, soil and canopy characteristics are spatially variable, both the pattern of soil moisture and the associated outflow must be represented in modelling these processes. This study compares implicit and explicit routing approaches to modelling the evolution of soil moisture pattern and spatially variable runoff production. It also addresses the implications of using different landscape partitioning strategies. This study presents the results of calibration and application of these different routing and landscape partitioning approaches on a 60 ha forested watershed in Western Oregon. For comparison, the different approaches are incorporated into a physically based hydro-ecological model, RHESSys, and the resulting simulated soil moisture, runoff production and sensitivity to unbiased error are examined. Results illustrate that both routing approaches can be calibrated to achieve a reasonable fit between observed and modelled outflow. Calibrated values for effective watershed hydraulic conductivity are higher for the explicit routing approach, which illustrates differences between the two routing approaches in their representation of internal watershed dynamics. The explicit approach illustrates a seasonal shift in drainage organization from watershed to more local control as climate goes from a winter wet to a summer dry period. Assumptions used in the implicit approach maintain the same pattern of drainage organization throughout the season. The implicit approach is also more sensitive to random error in soil and topographic input information, particularly during wetter periods. Comparison between the two routing approaches illustrates the advantage of the explicit routing approach, although the loss of computational efficiency associated with the explicit routing approach is noted. To compare different strategies for partitioning the landscape, the use of a non-grid-based method of partitioning is introduced and shown to be comparable to grid-based partitioning in terms of simulated soil moisture and runoff production. Copyright © 2001 John Wiley & Sons, Ltd.