Urbanization imposes considerable stress on river health and leads to the so-called "Urban Stream Syndrome." As an important components in running water ecosystems, benthic macroinvertebrate is sensitive to environmental change and can reflect variations in watershed environments. As a consequence of rising of populations and percentage of construction area associated with increasing urbanization, there have been marked increases in the total amount and concentration of pollution discharged into rivers. As a result, populations of sensitive species either disappear or are reduced in size, whereas Oligochaeta and Chironomidae become the dominant taxa. Biodiversity is decreased and shows a negative and exponential relationship with the intensity of urbanization. Total density of stream biota increases significantly, and collectors become the dominant functional feeding group. The increase in impervious area changes the hydrologic processes of watersheds. Seasonal dynamics of the community component is decreased, whereas the variation in density is increased. Secondary productivity increases, and food web is reduced in complexity. The present paper summarizes the principles and mechanisms underlying the effects of water pollution, hydrology, stream habitat, and land use on stream macroinvertebrates. Further research on urban stream macroinvertebrate ecology is also proposed. It is hoped that this review will promote urban stream ecology research and provide a scientific basis for watershed ecological management and river restoration.