Headwater stream ecosystems draining blanket peat-dominated catchments occur in many high-latitude river systems. These systems are thought to be very sensitive to threats from climate change, and land-use modification including artificial drainage, overgrazing, afforestation and vegetation burning. This study examined ten peatland streams in the headwaters of the River Tees to examine spatial and seasonal patterns of instream physicochemical variables and benthic macroinvertebrate communities across the stream network. Principle component analysis revealed significant positive relationships between catchment size and electrical conductivity, sulfate concentration, pH and median bed sediment size, and negative relationships with suspended sediment and aluminium concentrations. Seasonal variability was particularly evident in stream water temperature, benthic particulate organic matter and nitrate and chloride concentrations. Macroinvertebrate community abundance and diversity were typically similar across streams, but redundancy analysis demonstrated turnover of macroinvertebrate assemblages with increases in stream size. In particular, first- and second-order streams hosted small-sized stoneflies such as Amphinemura standfussi and Nemoura cambrica, while larger streams (third- and fourth-order) supported more mayflies and larger predatory stoneflies (e.g. Dinocras cephalotes and Perla bipunctata). Many environmental drivers of ecological patterns appear to work in synergy in peatland headwater streams, and controlled experiments may be necessary to disentangle some of the variables to guide effective conservation and management strategies in impacted peatland river systems. Copyright © 2010 John Wiley & Sons, Ltd.