A three-dimensional regional scale air quality model was developed to study the atmospheric transport, transformation and deposition of mercury (Hg) by formulating and incorporating mercury chemistry, cloud processes, and air–surface exchanges into the framework of Sarmap Air Quality Model (SAQM). Three mercury species were included: elemental mercury Hg(0), divalent mercury Hg(II), and particulate mercury Hg(p). Precipitating clouds, co-existing non-precipitating clouds, and fair weather clouds were considered in modeling the in-cloud transformation processes. A formulation of bi-directional air-surface exchange of elemental mercury was used for emission from, and dry deposition to, natural surfaces. Preliminary evaluation of the model was conducted by comparing six major weekly output variables, including ambient Hg concentrations and Hg concentration in precipitation, with corresponding measurements at eight monitoring stations in Connecticut for a summer week and a winter week. Model predictions of surface-level gaseous Hg concentrations were close to measured levels, agreeing to within 12% on average, about half the estimated error in measurements. The predicted Hg concentrations in precipitation were 50% higher than measured values on average, slightly lower than the estimated 60% error in measurements. The model was shown to be capable of predicting hourly concentrations and deposition fields of the three Hg species as well as in-cloud transformation of Hg(0) by each of the three cloud types, and useful in analyzing the effects of various controlling factors on the transport and transformation of Hg species in the atmosphere.