This study applies the WaTEM/SEDEM model, a watershed-scale model based on the Universal Soil Loss Equation (USLE), to enhance sustainable watershed management by identifying high-erosion-risk areas for targeted mitigation at various scales. It focuses on identifying potential errors in using statewide or worldwide land use data layers derived from remote-sensing algorithms and inaccuracies in the spatial distribution of cropland and soil types resulting in misinterpretation of sediment yields. These model limitations emphasize the need for field validation and precise input data, particularly stream data, to improve the reliability of these models. The study examines hydrologic rainfall-runoff processes in Tennessee’s 182 km2 Oostanaula catchment using various data sources, including the National Land Cover Database (NLCD), the European Space Agency WorldCover dataset (ESA), and manual field surveys. Three modeling scenarios were evaluated, with and without stream topology corrections, using the WaTEM/SEDEM model. It details the global data used, the methodology of the field survey, the simulation and validation of data, and the critical point identification. Significant discrepancies in long-term sediment transport predictions were found, depending on the land use data source. This study addresses watershed model validity and potential errors and recommendations for the use of globally available data.