A controversial issue in managing urbanizing watersheds is determining the scale at which conservation measures should be implemented. Current “best practices” suggest establishing riparian buffers along stream corridors and limiting impervious surfaces to prevent degradation of instream biological conditions. While there is increasing evidence that the amount of land covers (e.g., impervious surface, vegetation) has an impact on instream aquatic conditions, the effect of upland vegetation fragmentation on aquatic conditions requires further study. By using landscape metrics to quantity vegetation amount and distribution at the riparian and watershed scales, and a macroinvertebrate index to describe aquatic conditions, this study presents empirical evidence about the interactions between riparian and upland vegetation as they affect instream biological condition of 51 nested watersheds in the Puget Sound lowland. We ask if the fragmentation of vegetation within a watershed helps predict instream biological condition. In addition, we hypothesize that the fragmentation of vegetation at the riparian and watershed scales affects instream biological condition. Using parametric and non-parametric statistical analyses to test relationships, our findings suggest that the fragmentation of upland vegetation and the total amount of riparian vegetation explain the greatest amount of variation in aquatic conditions. These results help frame a management approach for conserving upland areas of vegetation through the use of land use planning techniques.