Spatial variation in soil water content and drainage due to differences in soil physical properties may lead to higher soil N loss, primarily through leaching and gaseous losses, and lower N fertilizer use efficiency. This research investigated the concept of variable-source N fertilizer application in which slow-release or treated N fertilizer was applied to areas in a field which have higher probability of N loss and conventional N fertilizer was applied to low-risk field areas. The proposed objectives of this study were to determine methods to delineate and map areas in fields which are more vulnerable to N loss due to wet conditions and to examine the use of a variable-source strategy to optimize crop N fertilizer use efficiency. Two field experiments planted to corn were initiated in 2005 in north east and north central Missouri on claypan soils. The field experiment located in northeast Missouri had treatments consisting of a control or applications of 168 kg N ha^-1 as broadcast pre-plant-applied urea, polymer-coated urea, a 50% blend of urea and polymer-coated urea, or anhydrous ammonia. The field experiment in north central Missouri conducted on a farmer's field had treatments of applications of 168 kg N ha^-1 as broadcast pre-plant-applied urea or polymer-coated urea. All N fertilizer treatments were applied on strips over 365 meters in length that included spatial variation in elevation and depth to the claypan layer. Assessment of environmental N loss and fertilizer N efficiency included measurement of soil nitrous oxide flux and crop N recovery. Based on initial results, this presentation will discuss whether variable-source N fertilizer application is an effective management practice to improve crop performance while reducing environmental N losses.