In the Retezat Mountains concentrations of O3, NO2 and SO2 in summer season 2000-2002 were low and below toxicity levels for forest trees. While NH3 concentrations were low in 2000, the 2001 and 2002 concentrations were elevated indicating possibility for increased N deposition to forest stands. More than 90% of the rain events were acidic with pH values <5.5, contributing to increased acidity of soils. Crown condition of Norway spruce (Picea abies) and European beech (Fagus sylvatica) was good, however, defoliation described as >25% of foliage injured increased from 9.1% in 2000 to 16.1% in 2002. Drought that occurred in the southern Carpathians between fall 2000 and summer 2002 and frequent acidic rainfalls could cause the observed decline of forest condition. Both Norway spruce and European beech with higher defoliation had lower annual radial increments compared to the trees with low defoliation. Ambient O3 levels found in the Retezat did not affect crown condition of Norway spruce or European beech.