Grass vegetation has been recommended for use in the prevention and control of soil erosion because of its dense sward characteristics and stabilizing effect on the soil. A general assumption is that grassland environments suffer from minimal soil erosion and therefore present little threat to the water quality of surface waters in terms of sediment and sorbed contaminant pollution. Our data question this assumption, reporting results from one hydrological year of observations on a field-experiment monitoring overland flow, drain flow, fluxes of suspended solids, total phosphorus (TP), and molybdate-reactive phosphorus (<0.45 µm) in response to natural rainfall events. During individual rainfall events, 1-ha grassland lysimeters yield up to 15 kg of suspended solids, with concentrations in runoff waters of up to 400 mg L–1. These concentrations exceed the water quality standards recommended by the European Freshwater Fisheries Directive (25 mg L–1) and the USEPA (80 mg L–1) and are beyond those reported to have caused chronic effects on freshwater aquatic organisms. Furthermore, TP concentrations in runoff waters from these field lysimeters exceeded 800 µg L–1. These concentrations are in excess of those reported to cause eutrophication problems in rivers and lakes and contravene the ecoregional nutrient criteria in all of the USA ecoregions. This paper also examines how subsurface drainage, a common agricultural practice in intensively managed grasslands, influences the hydrology and export of sediment and nutrients from grasslands. This dataset suggests that we need to rethink the conceptual understanding of grasslands as non-erosive landscapes. Failure to acknowledge this will result in the noncompliance of surface waters to water quality standards.