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Abstract Increased awareness of the negative effects of dams combined with an aging dam infrastructure has led to an increase in dam removals. However, ecological responses of downstream biota to such actions are poorly understood. We examined the influence of a pair of small dam removals on downstream periphyton and macroinvertebrates in Boulder Creek, WI (USA). The dams were 180 m apart and both were removed on 9 July 2003. We monitored algae and macroinvertebrates as well as habitat characteristics for approximately 2 months before and after the removals upstream and downstream from the two dams, and continued our observations over a similar period (mid‐May to mid‐July) the following summer. After the removals, an initial release of sediment significantly increased the proportion of fine sediments in the downstream reach and buried benthic substrate. This burial led to a 60% reduction in chlorophyll in the downstream reach the week following removal, while concentrations increased in the upstream reference reach. Similarly, macroinvertebrate densities 2 weeks post‐removal were lower relative to pre‐removal densities and were associated with declines of ephemeropterans, trichopterans and dipterans. Examination of Trichoptera genera demonstrated substantial changes in this assemblage associated with diminished densities of the formerly dominant genus Brachycentrus . Algal and invertebrate populations increased in the weeks after the dam removal, but did not reach densities similar to the upstream reference reach. In the following year, both periphyton and invertebrate densities were lower in the downstream reach, suggesting a long‐term effect of the removal. Thus, effects of the dam removal were alternatively positive or negative over time, and indicate that the time scale of consideration has a strong effect on the interpretation of the consequences of this management activity. Copyright © 2008 John Wiley & Sons, Ltd.