The natural hydrology of streams and rivers is being extensively modified by human activities. Water diversion, dam construction, and climate change have the potential to increase the frequency and intensity of low-flow events. Flow is a dominant force structuring stream aquatic insect communities, but the impacts of water diversion are poorly understood. Here we report results of an experimental stream flow diversion designed to test how aquatic insect communities respond to a low-flow disturbance. We diverted 40% to 80% of the water in three replicate streams for three summers, leading to summer flow exceedance probabilities of up to 99.9%. Shifts in habitat availability appeared to be a major driver of aquatic insect community responses. Responses also varied by habitat type: total insect density decreased in riffle habitats, but there was no change in pool habitats. Overall, the total biomass of aquatic insects decreased sharply with lowered flow. Collector-filterers, collector-gatherers, and scrapers were especially susceptible, while predatory insects were more resistant. Despite extremely low flow levels, there was no shift in aquatic insect family richness. The experimental water withdrawal did not increase water temperature or decrease water quality, and some wetted habitat was always maintained, which likely prevented more severe impacts on aquatic insect communities.