Soil net nitrogen mineralization and nitrification rates were studied on nine undisturbed, forested watersheds in an effort to explain large variations in nitrate export in streamflow within the mid-Appalachian region. Rates of soil net nitrogen mineralization and net nitrification were measured in the upper 10 cm of mineral soil over a 5-week summer incubation period (June–July) using nine buried bags in each of the three major soil types on each watershed. Watersheds with high, medium, and low nitrate export rates exhibited high, medium, and low mean net nitrogen mineralization and net nitrification rates, respectively. Exchangeable calcium (an index to site fertility), C/N ratios, and soil moisture content together explained 63% of the variation in soil nitrogen mineralization rates, and exchangeable calcium and soil moisture content explained 61% of the variation in soil nitrification rates using multiple regression analysis. The variation in watershed nitrate export was best explained by total nitrogen in the upper 10 cm of mineral soil (explained 46%) and the percentage of mineralization due to nitrification (explained 42%). Estimated rates of wet and dry atmospheric deposition of nitrogen were not significantly correlated with watershed nitrate export. Results from this study demonstrate that soil nitrogen pools and dynamics are the most critical factors controlling nitrate export from forested watersheds in the mid-Appalachians. Long-term changes in site fertility, C/N ratios, and soil moisture, which largely control microbial nitrogen cycling, should have a significant effect on long-term trends in nitrate leaching.