Population growth within drylands is occurring faster than growth in any other ecologic zone, putting pressure on already stressed water resources. Because the availability of surface water supplies in drylands tends to be highly variable, many of these populations rely on groundwater. A critical process contributing to groundwater recharge is the interaction between ephemeral channels and groundwater aquifers. Generally, it has been found that ephemeral channels contribute to groundwater recharge when streamflow infiltrates into the sandy bottoms of channels. This process has traditionally been studied in channels that drain large areas (10s to 100s km2). In this dissertation, I study the interactions between surface water and groundwater via ephemeral channels in a first-order watershed located on an arid piedmont slope within the Jornada Experimental Range (JER) in the Chihuahuan Desert. To achieve this, I utilize a combination of high-resolution observations and computer simulations using a modified hydrologic model to quantify groundwater recharge and shed light on the geomorphic and ecologic processes that affect the rate of recharge. Observational results indicate that runoff generated within the piedmont slope contributes significantly to deep percolation. During the short-term (6 yr) study period, we estimated 385 mm of total percolation, 62 mm/year, or a ratio of percolation to rainfall of 0.25. Based on the instrument network, we identified that percolation occurs inside channel areas when these receive overland sheetflow from hillslopes. By utilizing a modified version of the hydrologic model, TIN-based Real-time Integrated Basin Simulator (tRIBS), that was calibrated and validated using the observational dataset, I quantified the effects of changing watershed properties on groundwater recharge. Distributed model simulations quantify how deep percolation is produced during the streamflow generation process, and indicate that it plays a significant role in moderating the production of streamflow. Sensitivity analyses reveal that hillslope properties control the amount of rainfall necessary to initiate percolation while channel properties control the partitioning of hillslope runoff into streamflow and deep percolation. Synthetic vegetation experiments show that woody plant encroachment leads to increases in both deep percolation and streamflow. Further woody plant encroachment may result in the unexpected enhancement of dryland aquifer sustainability.