The main objective of the study was to assess the water quality of the Enfranz River by studying the distribution of macro-invertebrate taxa on the longitudinal gradient of the river. The macro-invertebrate community of the Enfranz River, located northwest of Bahir Dar city in the southern part of Lake Tana watershed, was studied to family taxonomic level in wet and dry seasons from August 2010 to May 2011. The river was sampled along its whole length at four sites from headwaters until its outflow in Lake Tana. A total of 15,286 macro-invertebrate individuals belonging to 35 families and 2 higher taxa were collected. The Shannon–Wiener diversity Index, the Hilsenhoff family-level biotic index, and three macro-invertebrate metrics were measured and related to five physico-chemical parameters. Macro-invertebrate diversity and biotic indices, and community metrics differed significantly among sampling sites (p <0.05), diversity being higher at the headwaters. Spearman's correlation coefficients showed that dissolved oxygen was significantly correlated with the macro-invertebrate diversity and biotic indices, and all three macro-invertebrate metrics (p <0.05). Diversity index, percent Ephemeroptera and percent Trichoptera were positively correlated to dissolved oxygen, whereas the biotic index and percent dipterans showed negative correlations. Furthermore, percent Ephemeroptera was negatively correlated with conductivity (p <0.05) and diversity was negatively related to total dissolved solids and conductivity. We conclude that downstream, the river is severely affected by land use of the people living along the river.