Rainfall simulation experiments were performed in areas of semiarid grassland (Bouteloua eriopoda) and arid shrubland (Larrea tridentata) in the Chihuahuan desert of New Mexico. The objective was to compare the runoff of nitrogen (N) and phosphorus (P) from these habitats to assess whether losses of soil nutrients are associated with the invasion of grasslands by shrubs. Runoff losses from grass- and shrub-dominated plots were similar, and much less than from bare plots located in the shrubland. Weighted average concentrations of total dissolved N compounds in runoff were greatest in the grassland (1.72 mg/l) and lowest in bare plots in the shrubland (0.55 mg/l). More than half of the N transported in runoff was carried in dissolved organic compounds. In grassland and shrub plots, the total N loss was carried in dissolved organic compounds. In grassland and shrub plots, the total N loss was highly correlated to the total volume of discharge. We estimate that the total annual loss of N in runoff is 0.25 kg/ha/yr in grasslands and 0.43 kg/ha/yr in shrublands -- consistent with the depletion of soil N during desertification of these habitats. Losses of P from both habitats were very small.