Deterioration of water quality can have many negative impacts on aquatic ecosystems, such as loss of species and shifts from pollution-sensitive towards pollution-tolerant organisms. Water quality in rivers can be reduced by high sediment loads that interfere with fish respiration and cover spawning areas, and can smother bottom-living organisms. High sediment loads may also disturb nutrient cycles in wetlands and estuaries, with resultant algal and bacterial blooms and loss of light and oxygen from the water. However, significant reductions in natural sediment loads, such as sedimentation behind dams, can be equally harmful by reducing nutrient availability downstream. Various pollutants have differing effects ranging from inducing catastrophic mortality to chronic illness, in addition to the effects of bio-accumulation through the food chain.

Indicators on the water quality of freshwater ecosystems can be a proxy for aquatic biodiversity loss. Already developed water quality indicators include:

• Biochemical Oxygen Demand (BOD), which reflects the level of organic pollution in the water.
• Nitrate concentration, which reflects the degree to which water is enriched by nutrients as a result of agriculture and sewage, resulting in algal growth (eutrophication).
• Suspended sediments, which indicate the degree to which the drainage basin has been eroded or disturbed, and related changes in the water flow regime.
• pH and temperature show the degree of acidification and thermal patterns of inland waters. Most aquatic organisms can tolerate specific pH and temperature ranges, and deviations from the ranges can influence aquatic community composition.

Many countries have data for some or all of these indicators, and work is underway on producing composite indices of freshwater quality that combine two or more indicators. The link between water quality and biodiversity loss might also be illustrated more clearly by adding threshold analyses that demonstrate expected impacts on biodiversity.