Three first‐order, hill country, pasture streams in Waikato, New Zealand, were chosen to investigate the effects of patches of late‐succession indigenous riparian forest on water quality, epilithon, stream morphology, and aquatic macro‐invertebrates. Sites were situated in open pasture and at two distances (c. 50 and 300 m) into a forest remnant on each stream. Shade, channel width, and epilithon biomass were restored to conditions similar to a native forest control site within 300 m of the streams entering the native forest remnants, whereas water chemistry and levels of surficial fine sediment changed more slowly. Invertebrate community composition showed shifts towards the native forest condition just 50 m into the forest remnants, and full recovery had occurred within 300 m. Results from this study suggest that discontinuous restoration of riparian margins could mitigate some changes associated with pastoral land use, but sediment and water quality problems may not be solved.