In Argentina, deforestation due to agriculture expansion is threatening the Semi-arid Chaco, one of the largest forested biomes of South America. This study focuses on the north-west boundary of the Argentine Semi-arid Chaco, where soybean is the most important crop. Deforestation was estimated for areas with different levels of soil and rainfall limitation for agriculture between 1972 and 2001, with a finer analysis in three periods starting in 1984, which are characterized by differences in rainfall, soybean price, production cost, technology-driven yield and national gross domestic product. Between 1972 and 2001, 588 900 ha (c. 20% of the forests) were deforested. Deforestation has been accelerating, reaching >28 000 ha yr−1 after 1997. The initial deforestation was associated with black bean cultivation following an increase in rainfall during the 1970s. In the 1980s, high soybean prices stimulated further deforestation. Finally, the introduction of soybean transgenic cultivars in 1997 reduced plantation costs and stimulated a further increase in deforestation. The domestic economy had little association with deforestation. Although deforestation was more intense in the moister (rainfall >600 mm yr−1) areas, more than 300 000 ha have already been deforested in the drier areas, suggesting that climatic limitations are being overcome by technological and genetic improvement. Furthermore, more than 300 000 ha of forest occur in sectors without major soil and rainfall limitations. If global trends of technology, soybean markets and climate continue, and no active conservation policies are applied, vast areas of the Chaco will be deforested in the coming decades.