Agricultural land near urban areas is commonly used as disposal sites for municipal wastewater sludge. As available agricultural land decreases in the Northeast, the feasibility of applying sludge to established hardwood forests is increasingly being considered. A major concern with this practice is the potential for the large quantities of nitrogen in sludge to be detrimental to the forest ecosystem. The objective of this study was to evaluate changes in nitrogen storage in several components of a hardwood forest amended with municipal sludge. In June 1986, aerobically digested liquid sludge was surface applied to a Maryland hardwood forest at rates of 0, 3, 6, and 12 dry Mg ha-1, corresponding to nitrogen loadings of 0, 200, 400, and 800 kg N ha-1, respectively. Soils from the 0 to 10 and 10 to 20 cm soil depth were analyzed for extractable NO3-N and NH4-N in the spring and fall of 1986 and 1987. Standing litter, litterfall, and leaves of five overstory and seven understory species were analyzed for total nitrogen annually. The first year following sludge application, total extractable nitrogen in the surface 10 cm of soil ranged from 28 mg kg-1 soil in the control to 125 mg kg-1 under the 800 kg N ha-1 treatment. Within two years, total extractable N in the soil surface was not significantly different among treatments. Nitrogen concentration in litterfall increased with increasing sludge rates but only during the second year after sludge was applied. Nitrogen in the standing litter of the 800 kg N ha-1 increased in response to sludge the first year after application, indicating that decomposition was accelerated in sludge-treated plots. The second year after sludge application, foliar nitrogen concentration was increased with increasing sludge rate in two of five tree species and four of seven understory species. The total nitrogen uptake was small compared with the total available nitrogen. Low rainfall in 1986 and 1987 may have limited nitrogen uptake by the vegetation.