The Madison and Minnelusa aquifers are two of the most important aquifers in the Black Hills area of South Dakota and Wyoming. Quantification and evaluation of various hydrologic budget components are important for managing and understanding these aquifers. Hydrologic budgets are developed for two scenarios, including an overall budget for the entire study area and more detailed budgets for subareas. Budgets generally are combined for the Madison and Minnelusa aquifers because most budget components cannot be quantified individually for the aquifers. An average hydrologic budget for the entire study area is computed for water years 1987-96, for which change in storage is approximately equal to zero. Annual estimates of budget components are included in detailed budgets for nine subareas, which consider periods of decreasing storage (1987-92) and increasing storage (1993-96). Inflow components include recharge, leakage from adjacent aquifers, and ground-water inflows across the study area boundary. Outflows include springflow (headwater and artesian), well withdrawals, leakage to adjacent aquifers, and ground-water outflow across the study area boundary. Leakage, ground-water inflows, and ground-water outflows are difficult to quantify and cannot be distinguished from one another. Thus, net ground-water flow, which includes these components, is calculated as a residual, using estimates for the other budget components. For the overall budget for water years 1987-96, net ground-water outflow from the study area is computed as 100 ft3/s (cubic feet per second). Estimates of average combined budget components for the Madison and Minnelusa aquifers are: 395 ft3/s for recharge, 78 ft3/s for headwater springflow, 189 ft3/s for artesian springflow, and 28 ft3/s for well withdrawals. Hydrologic budgets also are quantified for nine subareas for periods of decreasing storage (1987-92) and increasing storage (1993-96), with changes in storage assumed equal but opposite. Common subareas are identified for the Madison and Minnelusa aquifers, and previous components from the overall budget generally are distributed over the subareas. Estimates of net ground-water flow for the two aquifers are computed, with net ground-water outflow exceeding inflow for most subareas. Outflows range from 5.9 ft3/s in the area east of Rapid City to 48.6 ft3/s along the southwestern flanks of the Black Hills. Net groundwater inflow exceeds outflow for two subareas where the discharge of large artesian springs exceeds estimated recharge within the subareas. More detailed subarea budgets also are developed, which include estimates of flow components for the individual aquifers at specific flow zones. The net outflows and inflows from the preliminary subarea budgets are used to estimate transmissivity of flow across specific flow zones based on Darcy?s Law. For estimation purposes, it is assumed that transmissivities of the Madison and Minnelusa aquifers are equal in any particular flow zone. The resulting transmissivity estimates range from 90 ft2/d to about 7,400 ft2/d, which is similar to values reported by previous investigators. The highest transmissivity estimates are for areas in the northern and southwestern parts of the study area, and the lowest transmissivity estimates are along the eastern study area boundary. Evaluation of subarea budgets provides confidence in budget components developed for the overall budget, especially regarding precipitation recharge, which is particularly difficult to estimate. Recharge estimates are consistently compatible with other budget components, including artesian springflow, which is a dominant component in many subareas. Calculated storage changes for subareas also are consistent with other budget components, specifically artesian springflow and net ground-water flow, and also are consistent with water-level fluctuations for observation wells. Ground-water budgets and flowpaths are especially complex i