Palaeochannels or prior streams as they are commonly know, are common landscape features in much of the irrigated areas of the Murray Darling Basin. Earlier research has indicated that these features are areas of increased irrigation water losses due to their sandier textures. However, little is known about the pathways and movement of water after infiltration and how changes in soil properties and sedimentary layering govern this movement. Using data collected from electromagnetic induction surveys and soil cores, a palaeochannel system was reconstructed in PMWIN-MODFLOW. Hydraulic properties were estimated using pedotransfer functions of soil physical data. Based on the distribution of observed soil properties and the uncertainties related to the hydraulic property information several realisations of the palaeochannel system were created and Monte Carlo type simulations were run. Irrigation and rainfall top boundary inputs were applied to simulate water movement through the system. In addition, the slope of the lowest layer of the coarser-textured materials was varied to investigate lateral movement. The results indicate that variation in soil properties, soil layering, and slope of the channel has a greater effect on water movement under irrigation than under natural rainfall conditions.