Improvement of physical-chemical soil quality is a key step for carrying out revegetation programs of degraded lands in Mediterranean semiarid areas. Organic residue addition may restore the quality of these areas. A field experiment was conducted in a silt-loam soil (Typic Petrocalcid) from a degraded semiarid Mediterranean area to evaluate the effect of the addition of a composted urban residue on soil aggregate stability, bulk density and chemical properties and on the establishment of Pistacia lentiscus and Retama sphaerocarpa seedlings. The composted residue was applied at a rate of 6.7 kg m(-2) before planting. The nutrient content (NPK), total organic C and water soluble C were increased and bulk density was decreased, in the rhizosphere soil of both shrub species, by the composted residue. The addition of composted residue significantly increased the soil aggregate stability by about 22% for both shrub species. The beneficial effect of the composted residue on soil quality still persisted 18 months after addition. Eighteen months after planting, the addition of composted residue to soil had increased significantly the production of shoot biomass by P. lentiscus and R. sphaerocarpa, by about 160% and 320% respectively, compared to control values. Composted residue addition to soil can be considered an effective preparation method of a degraded area for carrying out successful revegetation programs with Mediterranean shrubs under semiarid conditions. (C) 2003 Elsevier Science Ltd. All rights reserved.