Artificial drainage (ditching) is widely used to increase timber yield in northern forests. When the drainage systems are maintained, their environmental impacts are likely to accumulate over time and along accompanying management, notably after logging when new forest develops on decayed peat. Our study provides the first comprehensive documentation of long-term ditching impacts on terrestrial and arboreal biodiversity by comparing natural alder swamps and second-generation drained forests that have evolved from such swamps in Estonia. We explored species composition of four potentially drainage-sensitive taxonomic groups (vascular plants, bryophytes, lichens, and snails), abundance of species of conservation concern, and their relationships with stand structure in two-ha plots representing four management types (ranging from old growth to clearcut). We found that drainage affected plot-scale species richness only weakly but it profoundly changed assemblage composition. Bryophytes and lichens were the taxonomic groups that were most sensitive both to drainage and timber-harvesting; in closed stands they responded to changed microhabitat structure, notably impoverished tree diversity and dead-wood supply. As a result, natural old-growth plots were the most species-rich and hosted several specific species of conservation concern. Because the most influential structural changes are slow, drainage impacts may be long hidden. The results also indicated that even very old drained stands do not provide quality habitats for old-growth species of drier forest types. However, drained forests hosted many threatened species that were less site type specific, including early-successional vascular plants and snails on clearcuts and retention cuts, and bryophytes and lichens of successional and old forests. We conclude that three types of specific science-based management tools are needed to mitigate ditching effects on forest biodiversity: (i) silvicultural techniques to maintain stand structural complexity; (ii) context-dependent spatial analysis and planning of drained landscapes; and (iii) lists of focal species to monitor and guide ditching practices.