Acid mine drainage (AMD) has degraded water quality and ecology in streams on the Stockton Plateau, the site of New Zealand's largest open-cast coal mining operation. This has previously been attributed largely to the effects of acidity and elevated aluminium (Al) concentrations. However, the toxicity of dissolved Al is dependent on speciation, which is influenced by pH which affects Al hydrolysis, as well as the concentrations of organic carbon and sulphate which complex Al. Methods for the assessment of the toxic fraction of Al, by chemical analysis and geochemical modelling, have been investigated in selected streams on the Stockton Plateau, where dissolved Al concentrations ranged from 0.034 to 27 mg L−1. Modelling using PHREEQC indicated that between 0.2 and 85% of the dissolved Al was present as the free ion Al3+, the most toxic Al species, which dominated in waters of pH = 3.8–4.8. Al-sulphate complexation reduced the Al3+ concentration at lower pH, while Al-organic and –hydroxide complexes dominated at higher pH. Macroinvertebrate richness in the streams identified an Al3+ ‘threshold’ of approximately 0.42 mg/L, above which taxa declined rapidly. Colorimetric ‘Aluminon’ analysis on unpreserved, unfiltered waters provided a better estimation of Al3+ concentrations than inductively couple plasma–mass spectrometry (ICP-MS) on filtered, acidified waters. The Aluminon method does not react with particulate Al or strong Al complexes, often registering as little as 53% of the dissolved Al concentration determined by ICP-MS.