Freshwater ecosystems and their associated organisms are among the most endangered in the world. Here we focus on bryophyte communities in streams characterized by a strong altitudinal gradient. The main purpose of this study was to determine the most important environmental variables affecting bryophyte species richness and composition and to quantify the relative importance of different sets of environmental variables. We studied bryophyte communities at upstream, intermediate and downstream sections of 16 streams distributed on the northern and southern side of Madeira Island in the Atlantic Ocean. We found that bryophyte species richness and composition was strongly affected by the measured environmental variables. Of particular importance were the geomorphological and hydrological variables as well as the chemical and physical properties of the streams. Temperature (or altitude) was highly correlated with other variables reflecting clear altitudinal gradients. While upstream communities were generally in a rather natural condition and rich in bryophyte species, downstream communities had less species and often anthropogenically modified stream banks. Due to the confounding of downstream areas with human influences and other variables such as temperature, the separate effects of these variables are not known. The relationship and the distributions of some bryophyte species/communities across the altitudinal range suggest that these riparian bryophyte communities may be sensitive to global warming.