A field-based microcosm approach was tested to identify deterioration of sediment quality in waterways using freshwater macroinvertebrates. The method can potentially identify the nature of contaminants based on species-specific responses. Sediments were collected from the Murray and Darling Rivers and irrigation drains within the Sunraysia region of south-eastern Australia and compared to non-polluted reference sediment. Clean sediments were also spiked with fertiliser to test whether nutrients affected the aquatic fauna. Seven of the eight sediments from the Sunraysia region had a negative impact on the macroinvertebrates, in particular sediment from the Darling River, which supported an impoverished fauna. Three species of chironomid showed varied responses to sediment quality and, although it was hypothesised that nutrients may have impacted on the macroinvertebrate fauna, the results suggest that other pollutants are also involved. The field-based microcosm method proved effective for determining the impact of sediment quality on indigenous macroinvertebrates.