Micrometeorite bombardment is thought to erode the main rings of Saturn and to produce a plasma locally, accounting for transient ring phenomena and the supply of water molecules to Saturn's atmosphere. This process is shown here to be also a significant source of water molecules and molecular ions in the region between the outer edge of the main rings and Enceladus, adding to those neutrals and plasma produced by sputtering of the icy satellites. However, the magnitude and distribution of the ring source depends on the micrometeorite flux and the energy distribution of the neutral ejecta, both of which are uncertain. Limiting cases are examined, their implications in the Cassini division are calculated, and their relevance to the neutral and plasma clouds in this region is discussed. ¢ 1991 Academic Press, Inc.