SUMMARY 1. Decomposition of red maple (Acer rubrum ) and rhododendron (Rhododendron maximum ) leaves and activity of associated microorganisms were compared in two reaches of a headwater stream in Coweeta Hydrologic Laboratory, NC, U.S.A. The downstream reach was enriched with ammonium, nitrate, and phosphate whereas the upstream reach was not altered. 2. Decomposition rate, microbial respiration, fungal and bacterial biomass, and the sporulation rate of aquatic hyphomycetes associated with decomposing leaf material were significantly higher for both leaf types in the nutrient-enriched reach. Species richness and community structure of aquatic hyphomycetes also exhibited considerable changes with an increase in the number of fungal codominants in the nutrient-enriched reach. 3. Fungal biomass was one to two orders of magnitude greater than bacterial biomass in both reaches. Changes in microbial respiration rate corresponded to those in fungal biomass and sporulation, suggesting a primary role of fungi in leaf decomposition. 4. Nutrient enrichment increased microbial activity, the proportion of leaf carbon channelled through the microbial compartment and the decomposition rate of leaf litter. [ABSTRACT FROM AUTHOR]