Drought and drying of perennial streams plays a central role in determining the structure of in-stream communities, decreasing taxa richness and abundance and changing trophic organisation. Further, flow cessation can increase spatial -diversity of macroinvertebrate communities across disconnected sites. It has been hypothesised that the hyporheic zone may act as a refugium for benthic macroinvertebrates during low flow and flow cessation, but evidence remains equivocal. We explored hyporheic and surface benthic macroinvertebrate community changes associated with low flow and flow cessation conditions during a supra-seasonal drought on two normally perennial rivers: the Cotter and Queanbeyan Rivers (Canberra, ACT). Surface benthic and hyporheic samples were collected from these two rivers and four associated tributary streams across a drying gradient during dry conditions and after flow recovery to test whether macroinvertebrates in perennial streams utilise the hyporheic zone as a refugium and whether there is greater variability in the macroinvertebrate community at sites experiencing flow cessation compared with wetter sites. Low flow had no impact on macroinvertebrate taxa richness or density in either surface benthic or hyporheic habitats, whereas density and taxa richness declined during streambed drying, suggesting that the hyporheic zone did not provide a refugium for some taxa during these dry conditions. Spatial -diversity peaked at dry sites, likely in response to the broad range of environmental conditions that may differ between refuges and sites, but decreased after flow recovery. Refuges in perennial streams appear more vulnerable to human disturbances during dry periods because a loss of suitable refuges can affect the ability of some macroinvertebrate taxa to recolonise after flow recovery. © 2011 CSIRO.