Performance assessments of potential low-level radioactive waste disposal sites require characterization of unsaturated-zone transport processes. These are complicated by thermal effects and vapor transport in arid regions. Controls on arid-region soil-water transport were elucidated in complementary site-specific, model-based (Scanlon and Milly, 1994, abstract, paper) and generic, theoretical (Milly, 1996, abstract, paper) studies. Observed seasonal variations and the depth-dependence of water potential at an arid site in the Chihuahuan Desert were explained in terms of non-isothermal theory of water transport in porous media. The basic conceptual picture developed from this dynamic-equilibrium analysis differs fundamentally from that associated with the established steady-flow approach. One result is that, in a dry environment, the long-term mean thermally driven vapor flux is directed downward and will induce a potential-driven (upward) return flow of liquid.