Urban development is a leading cause of stream impairment that reduces biodiversity and negatively affects ecosystem processes and habitat. Out-of-stream restoration practices, such as stormwater ponds, created wetlands, and restored riparian vegetation, are increasingly implemented as management strategies to mitigate impacts. However, uncertainty exists regarding how effectively they improve downstream ecosystems because monitoring is uncommon and results are typically reported on a case-by-case basis. We conducted a meta-analysis of literature and used response ratios to quantify how downstream ecosystems change in response to watershed development and to out-of-stream restoration. Biodiversity in unrestored urban streams was 47% less than that in reference streams, and ecological communities, habitat, and rates of nutrient cycling were negatively affected as well. Mean measures of ecosystem attributes in restored streams were significantly greater than, and 156% of, those in unrestored urban streams. Measures of biodiversity in restored streams were 132% of those in unrestored urban streams, and indices of biotic condition, community structure, and nutrient cycling significantly improved. However, ecosystem attributes and biodiversity at restored sites were significantly less than, and only 60% and 45% of, those in reference streams, respectively. Out-of-stream management practices improved ecological conditions in urban streams but still failed to restore reference stream conditions. Despite statistically significant improvements, assessing restoration success remains difficult due to few comparisons to reference sites or to clearly defined targets. These findings can inform future monitoring, management, and development strategies and highlight the need for preventative actions in a watershed context.