Assessments of flow reduction in streams often focus on changes to biological communities and in-stream physical characteristics, with little consideration for changes in ecosystem functioning. It is unclear whether functional indicators of ecosystem condition may be useful for assessing the impacts of reduced discharge on small streams. Using weirs and diversions to reduce stream discharge during summer baseflow conditions, we tested the response of leaf breakdown, coarse particulate organic matter (CPOM) retention, and primary production to one month of water abstraction in before-after, control-impact (BACI) designed experiments. Discharge at impact (downstream) reaches decreased by over 85% in each of three small New Zealand streams compared to controls (upstream). There also were decreases in velocity, depth, and wetted width. Sediment cover increased at impact reaches, but there were only small changes to conductivity, pH, and surface water temperature. We installed mesh bags filled with willow leaves in-stream for one month to measure leaf breakdown. Reduced discharge had little influence on leaf breakdown rate in these streams. Travel distances and retention structures for CPOM were evaluated using releases of paper strips and wooden dowelling over a range of discharges. The distance traveled by released CPOM increased with increasing discharge, and the importance of riffles as retention structures increased at lower discharges. We measured the accumulation of chlorophyll a after one month on artificial substrates as an estimate of the relative primary production of control and impact reaches. The differences in chlorophyll a concentrations between control and impact reaches were inconsistent among streams. These ecosystem functions have responded inconsistently to water removal in these streams. However, the strong response of CPOM retention to reduced discharge could complement measures of biological community structure when the influence of reduced discharge is assessed. We recommend further investigation in a wide range of streams to assess the utility of these processes as functional indicators of reduced discharge.