We set out to understand how urbanization affects streams in Ushuaia, Tierra del Fuego. Paired ttests and linear regressions were used to compare physico-chemical stream habitat variables (i.e., temperature, turbidity, conductivity, dissolved oxygen and pH) and benthic macroinvertebrate community structure (i.e., density, taxonomic richness, Shannon-Weiner diversity) and function (functional feeding groups [FFG]) in four watersheds with urban and reference sites. We then calculated indices of biotic integrity for habitat (rapid visual assessment protocol [RVAP]) and benthos (Ephemeroptera, Plecoptera, Trichoptera richness [EPT], family biotic index [FBI], rapid bioassessment protocol [RBP] and biotic monitoring Patagonian streams [BMPS]). Results indicated that urbanization negatively impacted these streams' underlying ecological condition, decreasing benthic biodiversity and dissolved oxygen, while increasing conductivity and turbidity. FFG assemblage was similar between both sites, but urbanization increased the existing dominance of collector-gatherers. Additionally, urban sites presented lower values in three of the benthic macroinvertebrate indices (EPT, RBP, BMPS, but not FBI) and also for habitat (RVAP). These data fill an existing gap in stream ecology for southern Patagonia and are useful to create monitoring tools. By incorporating urbanization as a driver of ecosystem change, managers and planners will be better able to confront the issue of sustainable development in this region, which is considered one of the most pristine wilderness areas remaining on the planet but whose human population is concentrated in a few densely populated urban areas.