The impact of topography on satellite passive microwave data hinders the soil moisture retrievals over mountainous regions. Current two-scale facet statistical microwave emission models for ocean-like rough surfaces and mountainous terrain use a 2-D slope distribution which is not explicitly linked to the small-scale scattering. We have developed a modified two-scale polarimetric model in sensor coordinates that decomposes the total emission into two statistically independent components, the incidence angle tilt and polarization orientation, which are directly and uniquely linked to the small-scale scattering and can thus provide insight into the physical process of scattering from topographic roughness. Based on tilt angle and polarization orientation angle (POA) distributions derived from digital elevation model (DEM) data, we examined the azimuthal modulation of the polarimetric signatures and their dependence on the soil moisture and vegetation conditions. We also compared the simulated third Stokes parameters against WindSat satellite observations over four regions in the American Southwest. Good agreements are found between the model simulation and WindSat observations.