1. Drainage of peat-dominated catchments across the world has caused widespread degradation of peat and freshwater ecosystem services. In the UK, an estimated £500 million has been spent over the last decade blocking drains to reverse these changes. The practice raises water tables to induce rewetting and promote peat aggradation. However, the potential benefits for impacted ecosystems such as streams remain unknown. 2. This study examined stream physico chemistry and benthic macroinvertebrates across peatland catchments with artificial drainage networks, or drains that have recently been blocked, and compared these with intact peatland sites having no history of drainage. 3. Streams in artificially drained catchments were characterized by more benthic fine particulate organic matter (FPOM), higher suspended sediment concentrations, and finer bed sediments (D50) than in drain-blocked and intact catchments. 4. Drained sites had a higher abundance of Diptera (Simuliidae and Chironomidae) larvae, and a lower abundance of Ephemeroptera, Plecoptera, and Trichoptera larvae, than drain-blocked sites. In contrast, streams in drain-blocked catchments had macroinvertebrate communities broadly similar to intact sites in terms of taxon richness, overall species composition, and community structure. These changes were associated with lower suspended sediment and benthic FPOM concentrations following drain-blocking. 5. Synthesis and applications. This study has shown changes in the structure of stream benthic macroinvertebrate assemblages linked to increases in benthic particulate organic matter and suspended sediment following peatland drainage. However, these effects seem to be reversible following catchment-scale restoration by drain-blocking. Drain-blocking, therefore, appears to benefit not only peatland soil, vegetation, and hydrological ecosystem services but also stream water quality and biodiversity. The numerous agencies undertaking peatland restoration should consider implementing detailed pre-and post-blocking monitoring of streams to further improve our understanding of the mechanisms through which peatland management affects stream biodiversity and biological recovery dynamics, refine drain-blocking practices, and inform aquatic conservation and management strategies.