We examined salmonid habitat and biomasses in 50–70-m pairs of altered and control sections of small (discharges less than 0.3 m3second-1) streams around Puget Sound in western Washington in 1978–1979. Altered sections had been channelized or used by livestock. Channelization significantly reduced overhead cover, sinuosity, wetted area, and woody bank cover while increasing bank grasses. Total habitat area declined in altered areas. These impacts most damaged the quality of habitat for cutthroat trout (Salmo clarki) over 70 mm in length. Biomass of coho salmon (Oncorhynchus kisutch) did not decline significantly in altered sections except in areas severely damaged. Zero-age trout (cutthroat and steelhead, Salmo gairdneri) suffered no loss of habitat quality, although larger trout did, except in areas of severe physical impact. Short-term effects of machinery operation in the one stream for which data were obtained included biomass depletions of all salmonid species and size classes. Channelization and livestock use appeared to reduce quality of winter habitat for salmonids. In altered sections with stable bottoms, no recent damage history, relatively little silt and sand, and adequate riffle areas, the reduction in overhead cover appeared to lead to higher standing crops of salmonids, suggesting that fish production in many streams of the Puget Sound area may be light-limited.