<p>Despite the widespread expansion of <i>Eucalyptus globulus</i> in smallholder farming systems of Ethiopia, its effects on spatial variability of soil physical and chemical properties remain insufficiently understood, particularly across distance gradients within woodlot–cropland interfaces. This study examined how <i>Eucalyptus globulus</i> influences selected soil physicochemical properties in smallholder farming systems of northwestern Ethiopia. The assessment considered variations in soil depth and distance from the tree in Gedamawit Zuria kebele. A randomized complete block design with three replications was used to collect soil samples at two depths (0–15 and 15–30&#xa0;cm) and five distances from the tree trunk (middle of canopy, 5, 10, 15, and 40&#xa0;m). Standard laboratory procedures were employed, and data were analyzed using ANOVA with mean separation by LSD at p &lt; 0.05. Results showed that soil bulk density was not significantly affected by distance but varied slightly with depth. Soil moisture increased significantly with distance, from 6.94% under the canopy to 39.87% at 40&#xa0;m in the surface layer. Soil pH increased from 4.91 beneath the canopy to 5.28 at 40&#xa0;m, indicating reduced acidity away from the tree. Soil organic carbon (2.10% to 1.52%), organic matter (3.62% to 2.64%), and total nitrogen (0.25% to 0.14%) decreased with increasing distance and depth. In contrast, exchangeable bases increased significantly with distance, with Ca²⁺ rising from 3.10 to 4.62 cmol ( +)/kg, Mg²⁺ from 1.52 to 2.05 cmol ( +)/kg, and K⁺ from 0.25 to 0.33 cmol ( +)/kg. <i>Eucalyptus globulus</i> creates a spatially heterogeneous soil environment, characterized by lower moisture, higher acidity, and reduced base cations near the canopy, and improved soil conditions farther away. Maintaining buffer zones and adopting integrated soil fertility management practices are recommended to reduce negative impacts on adjacent croplands.</p>