Gold mining in the Portovelo-Zaruma district in southern Ecuador is causing considerable environmental impacts; the most important ones are related to the discharge of cyanide, mercury and metal rich tailings into rivers of the Puyango catchment area. Cyanide and metal levels in rivers regularly exceed environmental quality criteria. The contamination impacts biodiversity, with cyanide causing a direct lethal effect on biota close to source and metal contaminants considerably reducing aquatic biodiversity further downstream. It is shown that the prevailing neutral or slightly alkaline conditions of the rivers ensure that metals are mainly associated with sediment. However, elevated metal levels in bottom living larvae collected from contaminated sites suggest that these sediment bound metals are readily bioavailable. Leaching experiments indicate that the relative ease by which metals are taken up by larvae is related to the speciation of sediment associated metals. It is further shown that large amounts of metals, which are bound to suspended sediment under ambient pH conditions, enter the dissolved and directly bioavailable state in more acidic conditions. Metal levels in carnivorous fish were found to be modestly elevated only, with the exception of mercury. Mercury levels exceeded 0.5 mg/kg in fish from both contaminated and uncontaminated sites, showing that both methylation and bioaccumulation of mercury are occurring in the Puyango river basin.