Factors influencing sediment transport and storage within the 156??6 km² drainage basin of Pancho Rico Creek (PRC), and sediment transport from the PRC drainage basin to its c. 11000 km² mainstem drainage (Salinas River) are investigated. Numeric age estimates are determined by optically stimulated luminescence (OSL) dating on quartz grains from three sediment samples collected from a 'quaternary terrace a (Qta)' PRC terrace/PRC-tributary fan sequence, which consists dominantly of debris flow deposits overlying fluvial sediments. OSL dating results, morphometric analyses of topography, and field results indicate that the stormy climate of the Pleistocene-Holocene transition caused intense debris-flow erosion of PRC- tributary valleys. However, during that time, the PRC channel was backfilled by Qta sediment, which indicates that there was insufficient discharge in PRC to transport the sediment load produced by tributary-valley denudation. Locally, Salinas Valley alluvial stratigraphy lacks any record of hillslope erosion occurring during the Pleistocene-Holocene transition, in that the alluvial fan formed where PRC enters the Salinas Valley lacks lobes correlative to Qta. This indicates that sediment stripped from PRC tributaries was mostly trapped in Pancho Rico Valley despite the relatively moist climate of the Pleistocene-Holocene transition. Incision into Qta did not occur until PRC enlarged its drainage basin by c. 50% through capture of the upper part of San Lorenzo Creek, which occurred some time after the Pleistocene-Holocene transition. During the relatively dry Holocene, PRC incision through Qta and into bedrock, as well as delivery of sediment to the San Ardo Fan, were facilitated by the discharge increase associated with stream-capture. The influence of multiple mechanisms on sediment storage and transport in the Pancho Rico Valley-Salinas Valley system exemplifies the complexity that (in some instances) must be recognized in order to correctly interpret terrestrial sedimentary sequences in tectonically active areas. ?? 2009 John Wiley & Sons, Ltd.