Existing prescriptive guidance on the derivation of local water quality benchmarks (WQBs; e.g., guideline values, criteria, standards) for protecting aquatic ecosystems is limited to only 3 to 4 specific approaches. These approaches do not represent the full suite available for deriving local WQBs for multiple types of water quality–related issues. The general lack of guidance is inconsistent with the need for, and benefits of, local WQBs, and can constrain the appropriate selection and subsequent evaluation of derivation approaches. Consequently, the defensibility of local WQBs may not be commensurate with the nature of the issues for which they are derived. Moreover, where local WQBs are incorporated into regulatory requirements, the lack of guidance presents a potential risk to the derivation of appropriate WQBs and the achievement of desired environmental outcomes. This review addresses the deficiency in guidance by 1) defining local WQBs and outlining initial considerations for deciding if one is required; 2) summarizing the existing regulatory context; 3) summarizing existing guidance and identifying gaps; 4) describing strengths, weaknesses, and potential applications of a range of derivation approaches based on laboratory and/or field data; and 5) presenting a conceptual framework for appropriately selecting and evaluating a derivation approach to best suit the need. The guidance incorporates an existing set of guiding principles for deriving local WQBs and reinforces an existing categorization of site‐adapted and site‐specific WQBs. The conceptual framework recognizes the need to strike an appropriate balance between effort and ecological risk and, thus, embeds the concept of fit‐for‐purpose by considering both the significance of the issue being assessed and the extent to which the approach provides confidence that the ecosystem will be appropriately protected. The guidance can be used by industry, regulators, and others for both the a priori selection and the post hoc evaluation of appropriate approaches for deriving local WQBs. Integr Environ Assess Manag 2019;15:683–702. © 2019 The Authors. Integrated Environmental Assessment and Management published by Wiley Periodicals, Inc. on behalf of Society of Environmental Toxicology & Chemistry (SETAC).