Nitrogen (N) enrichment of the biosphere is an expanding problem to which arid ecosystems may be particularly sensitive. In semiarid grasslands, scarce precipitation uncouples plant and microbial activities, and creates within the soil a spatial mosaic of rhizosphere and cyanobacterial crust communities. We investigated the impact of elevated N deposition on these soil microbial communities at a grama-dominated study site located incentral New Mexico (USA). The study plots were established in 1995 and receive 10 kg ha(-1) year(-1) of supplemental N in the form of NH(4)NO(3). Soil samples were collected in July 2004, following 2 years of severe drought, and again in March 2005 following a winter of record high precipitation. Soils were assayed for potential activities of 20 extracellular enzymes and N(2)O production. The rhizosphere and crust-associated soils had peptidase and peroxidase potentials that were extreme in relation to those of temperate soils. N addition enhanced glycosidase and phosphatase activities and depressed peptidase. In contrast to temperate forest soils, oxidative enzyme activity did not respond to N treatment. Across sampling dates, extracellular enzyme activity responses correlated with inorganic N concentrations. N(2)O generation did not vary significantly with soil cover or N treatment. Microbial responses to N deposition in this semiarid grassland were distinct from those of forest ecosystems and appear to be modulated by inorganic N accumulation, which is linked to precipitation patterns.