Indicators of ecological health based on biological communities, including numerous multimetric indices, are used worldwide to assess and report the condition of aquatic ecosystems such as estuaries. Yet, these tools have rarely been applied to support estuary management in Australia. We present a case study of one such multimetric indicator, the Fish Community Index (FCI), which was developed and applied to quantify the ecological condition of estuaries in southwestern Australia (SWA). We outline the rationale, development, and implementation of the FCI for annual monitoring and reporting of the ecological condition of a highly urbanized estuary, highlighting the key research and management outcomes that it has delivered, and evaluating its potential future applications to support estuary management more broadly, both across Australia and internationally. The FCI is founded upon a conceptually simple and scientifically robust rationale and is sensitive to the ecological stressors that affect many estuaries across the region (e.g., hypoxia, algal blooms). Together with an accompanying annual fish monitoring regime, the FCI provides managers with a consistent, robust basis for quantifying and reporting spatiotemporal changes in estuary condition, with easily comprehensible outputs that facilitate communication with stakeholders, ranging from politicians to the general public. We attribute the successful implementation of this management tool to several characteristics, namely 1) support from a long‐term, collaborative partnership between managers and researchers; 2) comprehensive testing and validation of the index prior to implementation; 3) a robust, standardized monitoring regime; and 4) sustained resourcing from managers to implement the index as part of a reporting framework. The FCI has also been applied to other SWA estuaries and could provide a platform for more coordinated assessment and reporting of estuarine condition at the bioregional scale, thereby helping to improve the gap in reporting on the biotic integrity of Australian estuaries. Integr Environ Assess Manag 2019;15:726–738. © 2019 SETAC.