A study was conducted during 2000-2001 at the Lorestan Meteorological and Agricultural Research Station, northeast Khorramabad, Iran, to evaluate the effects of mixed and monocropping of annual medics and fallow and chickpea cropping systems on surface runoff, erosion, water conservation and soil water holding capacity. Results showed that mixed cropping of annual medics, which have dense plant cover, performed better than its monocropping system in reducing surface runoff and erosion and in increasing water conservation and soil water holding capacity. The fallow system recorded the highest surface runoff and erosion. At the final stage of the experiment, the Medicago truncatula cv. orion and M. rigidula cv. rigidula mixed cropping system recorded the highest amount of conserved water in soil, which increased infiltration and soil water content, while chickpea cropping system recorded the lowest amount. The soil water retention capacity of mixed cropping system of annual medics was higher than the other treatments.