Physicochemical relationships in the boundary zone between groundwater and surface water (i.e. the hyporheic zone) are controlled by surface water hydrology and the hydrogeologic properties of the riverbed. We studied how sediment permeability and river discharge altered the vertical hydraulic gradient (VHG) and water quality of the hyporheic zone within the Hanford Reach of the Columbia River. The Columbia River at Hanford is a large, cobble-bed river where water level fluctuates up to 2 m daily because of hydropower generation. Concomitant with river stage recordings, continuous readings were made of water temperature, specific conductance, dissolved oxygen and water level of the hyporheic zone. The water level data were used to calculate VHG between the river and hyporheic zone. Sediment permeability was estimated using slug tests conducted in piezometers installed into the river bed. The response of water quality measurements and VHG to surface water fluctuations varied widely among study sites, ranging from no apparent response to covariance with river discharge. At some sites, a hysteretic relationship between river discharge and VHG was indicated by a time lag in the response of VHG to changes in river stage. The magnitude, rate of change and hysteresis of the VHG response varied the most at the least permeable location (hydraulic conductivity (K) = 2.9 × 10−4 cms−1) and the least at the most permeable location (K = 8.0 × 10−3 cms−1). Our study provides empirical evidence that sediment properties and river discharge both control the water quality of the hyporheic zone. Regulated rivers, like the Columbia River at Hanford, that undergo large, frequent discharge fluctuations represent an ideal environment in which to study hydrogeologic processes over relatively short time periods (i.e. days to weeks) that would require much longer periods (i.e. months to years) to evaluate in unregulated systems. Copyright © 2006 John Wiley & Sons Ltd.