A conventional, photogrammetrically derived digital elevation model (DEM; 10 m resolution) and a light detection and ranging (lidar)-derived DEM (1 m resolution) were used to model the stream network of a 193 ha watershed in the Swan Hills of Alberta, Canada. Stream networks, modelled using both hydrologically corrected and uncorrected versions of the DEMs and derived from aerial photographs, were compared. The actual network, mapped in the field, was used as verification. The lidar DEM-derived network was the most accurate representation of the field-mapped network, being more accurate even than the photo-derived network. This was likely due to the greater initial point density, accuracy and resolution of the lidar DEM compared with the conventional DEM. Lidar DEMs have great potential for application in land-use planning and management and hydrologic modelling. The network derived from the hydrologically corrected conventional DEM was more accurate than that derived from the uncorrected one, but this was not the case with the lidar DEM. Copyright © 2007 John Wiley & Sons, Ltd.