Biomass production in arid zones may be increased without irrigation by using runoff farming techniques. The salient feature of this technique is that large amounts of water are collected a few times per year and percolate deep into the soil. The combined cultivation of shallow rooting annuals and deep rooting perennials (agroforestry) was proposed as a method by which fodder and firewood could be simultaneously produced and stored water used efficiently. As a first step to test the feasibility of this proposal, Acacia salicina and Eucalyptus occidentalis were grown at two densities (625 and 1250 trees ha−1) in runoff catchment basins in the Northern Negev Desert of Israel (average rainfall: 115 mm a−1). Biomass, soil moisture content and some plant physiological parameters were periodically recorded. Total above-ground dry matter after three years was 15 and 19 t ha−1 for A. salicina and 25 and 28 t ha−1 for E. occidentalis at low and high density, respectively. Soil water balance studies during the growing season indicate that for the conditions under which this trial was carried out, tree roots do not explore the upper soil layers efficiently and that relatively high leaf water potential can be maintained by taking up water from deeper layers. These results suggest that water from surface layers could be used by annual crops without affecting production of the perennial crop.