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We hypothesize that total hillslope water loss for a rainfall–runoff event is inversely related to a function of a lognormal random variable, based on basin- and point-scale observations taken from the 21 km<sup>2</sup> Goodwin Creek Experimental Watershed (GCEW) in Mississippi, USA. A top-down approach is used to develop a new runoff generation model both to test our physical-statistical hypothesis and to provide a method of generating ensembles of runoff from a large number of hillslopes in a basin. The model is based on the assumption that the probability distributions of a runoff/loss ratio have a space–time rescaling property. We test this assumption using streamflow and rainfall data from GCEW. For over 100 rainfall–runoff events, we find that the spatial probability distributions of a runoff/loss ratio can be rescaled to a new distribution that is common to all events. We interpret random within-event differences in runoff/loss ratios in the model to arise from soil moisture spatial variability. Observations of water loss during events in GCEW support this interpretation. Our model preserves water balance in a mean statistical sense and supports our hypothesis. As an example, we use the model to generate ensembles of runoff at a large number of hillslopes for a rainfall–runoff event in GCEW.