Technical Abstract: Woodland encroachment on United States (US) rangelands has altered the structure and function of shrub steppe ecosystems. The potential community structure is one where trees dominate, shrub and herbaceous species decline, and rock cover and bare ground area increases and becomes more interconnected. Research from pinyon and juniper woodlands in the Desert Southwest US has demonstrated areas under tree canopies effectively store water and soil resources while areas between canopies (intercanopy) generate significantly more runoff and erosion. We investigated these relationships and the impacts of tree encroachment on runoff and erosion processes at two woodland sites in the Great Basin, USA. Rainfall simulation and concentrated flow methodologies were employed to measure infiltration, runoff, and erosion from intercanopy and canopy areas at small (0.5 m2) and large (13 m2) plot scales. Soil water repellency and vegetative and basal cover factors that influence runoff and erosion were quantified. Runoff and erosion from rainsplash, sheetwash, and concentrated flow processes were significantly greater from intercanopy than canopy areas across small and large plot scales and site specific erodibility differences were observed. Runoff and erosion were primarily dictated by the type and quantity of basal cover. Litter offered protection from rainsplash effects, provided rainfall storage, mitigated soil water repellency impacts on infiltration, and contributed to aggregate stability. Runoff and erosion increased exponentially (r2 = 0.75 and 0.64) where bare ground and rock cover exceeded 50%. Sediment yield was strongly correlated (r2 = 0.87) with runoff and increased linearly where runoff exceeded 20 mm h-1. Measured runoff and erosion rates suggest tree canopies represent areas of hydrologic stability while intercanopy areas are vulnerable to runoff and erosion. Results demonstrate the overall hydrologic vulnerability of sagebrush steppe following woodland encroachment depends on the potential influence of tree dominance on bare intercanopy expanse and connectivity and the potential erodibility of intercanopy areas.