A field and laboratory study was conducted on groundwater and soil collected from the riparian zone and meadow at Carroll Creek, Ontario, Canada. The objective was to investigate the removal of nitrate (NO\sb3\sp−-N) from agricultural drainage waters and assess rates of denitrification by soil microorganisms. Groundwater NO\sb3\sp−-N varied seasonally, with peak concentrations occurring in spring. Both woody and riparian areas demonstrated a capacity to remove essentially 100% of NO\sb3\sp−-N from subsurface water (to 6 m below ground surface). Soil sampling depth and proximity to the stream had little influence on the distribution of denitrification rates. However, N\sb2O production in subsurface soil samples indicated denitrification was a NO\sb3\sp−-N removal mechanism below the root zone. The relationship between denitrification and measures of soil microbial community structure suggested denitrification may be dependent on critical levels of microbial functional diversity, species richness and Shannon evenness.