We investigated the mechanisms involved in the relationship between land-use changes and aquatic biodiversity, using stream fish assemblages of the Brazilian Savanna (i.e., Cerrado) as a study model. We tested the prediction that landscape degradation would decrease environmental heterogeneity and change predominant physical-habitat types, which in turn would decrease the functional diversity and alter the functional identity of fish assemblages. We sampled fish from 40 streams in the Upper Paraná River basin, and assessed catchment and instream conditions. We then conducted an ecomorphological analysis to functionally characterize all species (36) and quantify different facets of the functional structure of assemblages. We detected multiple pathways of the impacts from landscape changes on the fish assemblages. Catchment degradation reduced the stream-bed complexity and the heterogeneity of canopy shading, decreasing assemblage functional specialization and divergence. Landscape changes also reduced the water volume and the amount of large rocks in streams, resulting in decreased abundances of species with large bodies and with morphological traits that favor swimming in the water column. We conclude that land-use intensification caused significant changes in aquatic biodiversity in the Cerrado, reinforcing the need to pay special attention to this global hotspot.</jats:p>