The natural abundance of nitrogen and oxygen isotopes in nitrate can be a powerful tool for identifying the source of nitrate in streamwater in forested watersheds, because the two main sources of nitrate, atmospheric deposition and microbial nitrification, have distinct δ18O values. Using a simple mixing model, we estimated the relative fractions in streamwater derived from these sources for two forested watersheds with markedly different streamwater nitrate outputs. In this study, we monitored δ15N and δ18O of nitrate biweekly in atmospheric deposition and in streamwater for 20 months at the Hubbard Brook Experimental Forest, New Hampshire, USA (moderate nitrogen export), and monthly in streamwater at the Bowl Research Natural Area, New Hampshire, USA (high nitrogen export). For rain, δ18O values ranged from +47 to +77‰ (mean: +58‰) and δ15N from −5 to +1‰ (mean: −3‰); for snow, δ18O values ranged from +52 to +75‰ (mean: +67‰) and δ15N from −3 to +2‰ (mean: −1‰). Streamwater nitrate, in contrast to deposition, had δ18O values between +12 and +33‰ (mean: +18‰) and δ15N between −3 and +6‰ (mean: 0‰). Since nitrate produced by nitrification typically has δ18O values ranging from −5 to +15‰, our field data suggest that most of the nitrate lost from the watersheds in streamflow was nitrified within the catchment. Our results confirm the importance of microbial nitrogen transformations in regulating nitrogen losses from forested ecosystems and suggest that hydrologic storage may be a factor in controlling catchment nitrate losses. Copyright © 2004 John Wiley & Sons, Ltd.