1. Water abstraction strongly affects streams in arid and semiarid ecosystems, particularly where there is a Mediterranean climate. Excessive abstraction reduces the availability of water for human uses downstream and impairs the capacity of streams to support native biota.

2. We investigated the flow regime and related variables in six river basins of the Iberian Peninsula and show that they have been strongly altered, with declining flows (autoregressive models) and groundwater levels during the 20th century. These streams had lower flows and more frequent droughts than predicted by the official hydrological model used in this region. Three of these rivers were sometimes dry, whereas there were predicted by the model to be permanently flowing. Meanwhile, there has been no decrease in annual precipitation.

3. We also investigated the fish assemblage of a stream in one of these river basins (Tordera) for 6 years and show that sites more affected by water abstraction display significant differences in four fish metrics (catch per unit effort, number of benthic species, number of intolerant species and proportional abundance of intolerant individuals) commonly used to assess the biotic condition of streams.

4. We discuss the utility of these metrics in assessing impacts of water abstraction and point out the need for detailed characterisation of the natural flow regime (and hence drought events) prior to the application of biotic indices in streams severely affected by water abstraction. In particular, in cases of artificially dry streams, it is more appropriate for regulatory agencies to assign index scores that reflect biotic degradation than to assign ‘missing’ scores, as is presently customary in assessments of Iberian streams.