The flow regime is regarded by many aquatic ecologists to be the key driver of river and floodplain wetland ecosystems. We have focused this literature review around four key principles to highlight the important mechanisms that link hydrology and aquatic biodiversity and to illustrate the consequent impacts of altered flow regimes: Firstly, flow is a major determinant of physical habitat in streams, which in turn is a major determinant of biotic composition; Secondly, aquatic species have evolved life history strategies primarily in direct response to the natural flow regimes; Thirdly, maintenance of natural patterns of longitudinal and lateral connectivity is essential to the viability of populations of many riverine species; Finally, the invasion and success of exotic and introduced species in rivers is facilitated by the alteration of flow regimes. The impacts of flow change are manifest across broad taxonomic groups including riverine plants, invertebrates, and fish. Despite growing recognition of these relationships, ecologists still struggle to predict and quantify biotic responses to altered flow regimes. One obvious difficulty is the ability to distinguish the direct effects of modified flow regimes from impacts associated with land-use change that often accompanies water resource development. Currently, evidence about how rivers function in relation to flow regime and the flows that aquatic organisms need exists largely as a series of untested hypotheses. To overcome these problems, aquatic science needs to move quickly into a manipulative or experimental phase, preferably with the aims of restoration and measuring ecosystem response.