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We assessed the seed bank dynamics, standing herbage dynamics and soil loss along two gradients of grazing with different histories of grazing use, in the arid grasslands of central Australia. We also examined the impact grazing had on the number of 'safe sites' for seeds by assessing the fine-and broad-scale trapping of resources. It is likely that the size of seed banks was reduced in the first instance by the indirect effects of grazing through the loss of `safe sites'. For both gradients, the process of soil destabilisation and loss preceded changes to the vegetation composition. This suggests that, in this environment, soil-based rather than vegetation based indicators would provide a better early warning of rangeland deterioration.