Despite observational evidence of lateral preferential flow paths in northeastern U.S. watersheds, their effects on the sources of runoff remain unclear. An intense field survey was undertaken during the 2007 growing season to determine the sources of stream runoff from a 2.51 km2 watershed in the Catskill Mountains, New York State. Lateral preferential flow paths are caused by groundwater springs and soil piping in this region. A two-component hydrograph separation using δ18O showed that event water (rain water) was a significant source of runoff during nine rainfall events (from July to October). With these rainfall events, 14 to 37% of the volume and 18 to 49% of the peak streamflow was attributable to event water. Further, end-member mixing analysis (EMMA), using δ18O, Si, and dissolved organic carbon (DOC), showed that saturated areas accounted for 2 to 24% of the total volume and 4 to 59% of peak streamflow but that groundwater was the dominant source of runoff volume during all events. Field surveys of saturated areas also suggested that near-stream areas were insufficient to generate the observed stream chemistry during rainfall events larger than 8 mm. A connection with the hillside saturated areas was therefore required to explain the results of the hydrograph separations, which were corroborated by the timing of the transient (perched) groundwater and overland flow. The hydrometric measurements confirmed that hillside lateral preferential flow paths rapidly transported water to near-stream saturation areas during runoff events under relatively dry antecedent conditions. A qualitative comparison with conventional techniques for distributing variable saturation areas (VSA) using surface topography and soil transmissivity (i.e., topographic index and soil topographic index), which do not consider the effects of lateral preferential flow paths, demonstrated that typical parameterizations (on the order of <10−1 m) would not have the spatial resolution to represent the measured lateral preferential flow paths (on the order of <10−3 m). Overall, the results suggest that the lateral redistribution of water from hillside areas reduces the influence of surface topography and channel topology on the sources of stream runoff, a finding that is consistent with recent ones from other landscapes where glacial soils have coevolved with the terrestrial hydrology.