Evaporation from the soil surface (E) can be a significant source of water loss in arid areas. In sparsely vegetated systems, E is expected to be a function of soil, climate, irrigation regime, precipitation patterns, and plant canopy development, and will therefore change dynamically at both daily and seasonal time scales. The objectives of this research were to quantify E in an isolated, drip irrigated vineyard in an arid environment and to simulate below canopy E using the HYDRUS (2D/3D) model. Specific focus was on variations of E both temporally and spatially across the inter-row. Continuous above canopy measurements, made in a commercial vineyard, included evapotranspiration, solar radiation, air temperature and humidity, and wind speed and direction. Short-term intensive measurements below the canopy included actual and potential E and solar radiation along transects between adjacent vine-rows. Potential and actual E below the canopy were highly variable, both diurnally and with distance from the vine-row, as a result of shading and distinct wetted areas typical to drip-irrigation. While the magnitude of actual E was mostly determined by soil water content, diurnal patterns depended strongly on position relative to the vine-row due to variable shading patterns. HYDRUS (2D/3D) successfully simulated the magnitude, diurnal patterns and spatial distribution of E, including expected deviations as a result of variability in soil saturated hydraulic conductivity.