1. Desertification negatively impacts a large proportion of the global human population and > 30% of the terrestrial land surface. Better methods are needed to detect areas that are at risk of desertification and to ameliorate desertified areas. Biological soil crusts are an important soil lichen-moss-microbial community that can be used toward these goals, as (i) bioindicators of desertification damage and (ii) promoters of soil stability and fertility. 2. We identified environmental factors that correlate with soil crust occurrence on the landscape and might be manipulated to assist recovery of soil crusts in degraded areas. We conducted three studies on the Colorado Plateau, USA, to investigate the hypotheses that soil fertility [particularly phosphorus (P), manganese (Mn) and zinc (Zn)] and/or moisture limit soil crust lichens and mosses at four spatial scales. 3. In support of the soil fertility hypothesis, we found that lichen-moss crusts were positively correlated with several nutrients [Mn, Zn, potassium (K) and magnesium (Mg) were most consistent] at three of four spatial scales ranging from 3.5 cm2 in area to c. 800 km2. In contrast, P was negatively correlated with lichen-moss crusts at three scales. 4. Community composition varied with micro-aspect on ridges in the soil crust. Three micro-aspects [north-north-west (NNW), east-north-east (ENE) and TOP] supported greater lichen and moss cover than the warmer, windward and more xeric micro-aspects [west-south-west (WSW) and south-south-east (SSE)]. This pattern was poorly related to soil fertility; rather, it was consistent with the moisture limitation hypothesis. 5. Synthesis and application. Use of crusts as desertification bioindicators requires knowledge of a site's potential for crust cover in the absence of desertification. We present a multi-scale model of crust potential as a function of site properties. Future quantitative studies can use this model to guide sampling efforts. Also, our results suggest new directions in restoration research: enhancement of moisture residence time and fertilization with key nutrients (Mn, Zn, K and Mg). Re-establishment of soil crusts in desertified lands will help regain lost soil stability and fertility, and facilitate plant re-establishment. ?? 2006 British Ecological Society.