Abstract Benthic macroinvertebrates were sampled from four sites on upland streams in the Wentworth Falls area of the Blue Mountains, NSW. One site received effluent from a sewage treatment plant and the others were reference sites. Five replicate collections were taken from each site on four occasions at intervals of 3 months. Macroinvertebrate community data were analysed using univariate (ANOVA) and multivariate (NMDS) techniques and comparisons were made between analyses at different levels of taxonomic aggregation and using different methods of data transformation. Similar patterns were observed at both species and family levels, and even the order level showed a clear community response to effluent input. Binary (presence/ absence) data provided similar results to quantitative data for the species and family levels. However, when binary data were used at the order level, the distinctions between the reference sites became blurred. We discuss the implications of these findings for environmental monitoring.