In many of the world's drylands, human-induced alteration of grazing and fire regimes over the past century has promoted the replacement of grasses by woody vegetation. Here, we evaluate the magnitude of changes in plant and soil carbon and nitrogen pools in a subtropical landscape undergoing succession from grassland to thorn woodland in southern Texas. Our approach involved linking a process-based ecosystem model to a transition matrix model. Grass and forest production submodels of CENTURY were parameterized with field data collected from herbaceous and wooded landscape elements broadly representative of habitats in global savanna systems. The Markov (transition matrix) model simulated the displacement of grassland communities under land use practices typical of many modern grasslands and savannas (heavy livestock grazing; no fire) and climate events. The modeled landscape was initialized for pre-Anglo-European settlement grassland conditions and then subjected to heavy, continuous livestock grazing and elimination of fire beginning in the mid-1800s. Rates of woody plant encroachment were directed by the Markov model, and the consequences for net primary production and plant and soil C and N pools were tracked by CENTURY.Modeled output of plant and soil organic C were in good agreement with those quantified for present-day patch types, suggesting our reconstructions were reasonable. Results indicated that, in the absence of woody plant encroachment, heavy grazing and fire suppression would have reduced soil organic carbon mass in southern Texas grasslands 17% (clay loam lowlands) to 18% (sandy loam uplands) by the 1990s. Soil and plant carbon stocks in current (mid-1900s) Prosopis woodlands are estimated to exceed those of the pristine grasslands they have replaced by 1.3ϫ and 10ϫ, respectively. Our reconstructions thus suggest that an initial degradation phase induced by heavy livestock grazing was followed by a woody-plant-induced aggradation phase that is still in progress. Under climatic/atmospheric conditions of the past 100 years, future landscapes would equilibrate at soil and plant C densities that would be 3ϫ and 15-24ϫ that of the pristine, presettlement grasslands they have replaced. Replacement of grasslands and savannas by woodlands in this bioclimatic region has thus resulted in significant and ongoing increases in landscape-scale ecosystem carbon stocks in a relatively short (ϳ100 years) period of time.