An isotopic dilution method was used to test the effects of osmotic potential, (IJ' ,), upon nitrification, ammonification, N-immobilization, and nitrous oxide production rates in soil at solute concentrations encountered in Penoyer soil. A nitrification potential assay was also performed to approximate maximum nitrification rates. Nitrification potential rates in soil slurries exponentially declined in response to decreased osmotic potential. However, nitrification was independent of salt concentration at the ambient NIL+ concentrations of the soil. The differential response was attributed to the variable NIL+ substrate quantities. The effects of osmotic potential were secondary to NIL+ substrate levels in controlling nitrification rates. Ammonification rates declined exponentially as a function of decreased osmotic potential; however, the 33% reductions in ammonification rates were restricted to a range of osmotic potentials between 0 and -500 kPa. Ammonification rates were independent of osmotic potential at potentials between -500 and -1800 kPa. Immobilization rates of both NH/ and N03- declined exponentially as osmotic potential decreased. Absolute rates ofN03- immobilization exceeded those of N~ • by a factor of 4, indicating that under N~+ limited conditions, substantial N03- assimilation occurred. However, the generalization that N~ + is the preferred N source was in fact supported by the data, where immobilization rates relative to the respective pool sizes clearly favored NH4 + assimilation. Nitrous oxide production rates increased linearly as osmotic potential decreased. An NH4 + dependence indicated the evolved N20 was derived from nitrification rather than denitrification.