The Kinleith pulp and paper mill discharges effluent into the Kopakorahi arm of Lake Maraetai (New Zealand) resulting in an effluent gradient defined by the effluent visibility (Secchi disc), transmittance (465 nm), temperature, and oxygen level that is discernible at least as far down stream as the adjoining Lake Waipapa. This effluent gradient is reflected in the composition of the fauna caught in fyke nets which at the most effluent‐exposed sites is dominated by goldfish (Carassius auratus) and is depauperate in pollution‐sensitive species such as freshwater crayfish (Paranephrops planifrons) and trout (Salmo truttaandOncoryhynchus mykiss) In 1991 the Kinleith mill undertook substantial process modifications which have resulted in improvements in the water quality of the discharge. Secchi disc visibilities have increased markedly at the most effluent‐exposed sites since modernisation of the mill and similar improvements have been observed in light transmittance. A seasonal trend in water temperature not previously observed was recorded at the most effluent‐exposed sites following modernisation, and dissolved oxygen levels at these sites rose markedly. Improvements in the water quality of the recipient since the mill modernisation are reflected in changes in the sampled fauna in particular the occurrence of trout at sites from which they were previously absent.