In the past, vadose zone processes in groundwater flow models were dramatically simplified (or even neglected) due to constraints on computational resources. The one-dimensional unsaturated flow package HYDRUS, recently developed for the groundwater model MODFLOW, was evaluated and compared with other contemporary modeling approaches used to characterize vadose zone effects in groundwater models. Being fully incorporated into the MODFLOW program, the HYDRUS package provides MODFLOW with recharge fluxes at the water table, while MODFLOW provides HYDRUS with the position of the groundwater table that is used as the bottom boundary condition in the package. The performance of the HYDRUS package was analyzed for three case studies of increasing complexity: (i) a one-dimensional infiltration experiment; (ii) a two-dimensional water table recharge experiment; and (iii) a hypothetical regional-scale groundwater flow problem. The computational need and modeling efficiency of the HYDRUS package was compared with other relevant MODFLOW packages (VSF, UZF1, and REC-ET). For smaller scale problems (up to two dimensions), the VSF process and the HYDRUS and UZF1 packages performed comparably well in terms of modeling efficiency and simulation times. Because of the high computational demand, it was not feasible to use the VSF process on a typical personal computer for the hypothetical large-scale groundwater problem. The HYDRUS package provided a much more efficient alternative to VSF for this large-scale groundwater problem and could better account for vadose zone processes than the UZF1 and REC-ET packages. For large-scale groundwater problems, the HYDRUS package provides an optimal tradeoff between computational effort and accuracy of model simulations for coupled vadose zone–groundwater problems.