Plant roots serve as conduits for water flow not only from soil to leaves but also from wetter to drier soil. This hydraulic redistribution through root systems occurs in soils worldwide and can enhance stomatal opening, transpiration, and plant carbon gain. For decades, upward hydraulic lift (HL) of deep water through roots into dry, litter-rich, surface soil also has been hypothesized to enhance nutrient availability to plants by stimulating microbially controlled nutrient cycling. This link has not been demonstrated in the field. Working in sagebrush-steppe, where water and nitrogen limit plant growth and reproduction and where HL occurs naturally during summer drought, we slightly augmented deep soil water availability to 14 HL+ treatment plants throughout the summer growing season. The HL+ sagebrush lifted greater amounts of water than control plants and had slightly less negative predawn and midday leaf water potentials. Soil respiration was also augmented under HL+ plants. At summer's end, application of a gas-based (15)N isotopic labeling technique revealed increased rates of nitrogen cycling in surface soil layers around HL+ plants and increased uptake of nitrogen into HL+ plants' inflorescences as sagebrush set seed. These treatment effects persisted even though unexpected monsoon rainstorms arrived during assays and increased surface soil moisture around all plants. Simulation models from ecosystem to global scales have just begun to include effects of hydraulic redistribution on water and surface energy fluxes. Results from this field study indicate that plants carrying out HL can also substantially enhance decomposition and nitrogen cycling in surface soils.