In order to evaluate the ecological health condition of Zhanghe River Watershed, an adapted Benthic Index of Biotic Integrity (B-IBI) was developed. Macro-invertebrates were sampled at 12 monitoring stations which were grouped into two condition categories (reference and impaired stations) according to the level of degradation. A total of 47 benthic macroinvertebrates taxa were identified, in which aquatic insects 33 taxa, Mollusca 8, Annalida 3 and Crustacea 3 taxa. Based on macro-invertebrate assemblages characters of this area, 18 candidate biological metrics in four categories, including taxonomic richness, community composition, pollution tolerance, trophic guild, and value distribution, were chosen. In which, four metrics were excluded because of low values or narrow distribution range. Discriminatory power between reference and impaired stations was analysed using box-plots, and six metrics were excluded because the medians of the box-plot inside the inter quartile range. Of all the rest eight metrics, four were not suitable for B-IBI index system because of their high Pearson correlation (| r | 0.75). Finally, total taxa, percentage of Crustacea and Mollusca, percentage of tolerant taxa and percentage of predators were screened out to form a B-IBI index system. Ratio scoring method for B-IBI index was used to get a uniform score. Evaluation criterion was established based on the 25 percentiles value of reference stations. Assessment results using B-IBI showed 5 of sampling stations were in ‘healthy’ and ‘sub-healthy’ state, 3 were in ‘fair’ state, and 4 were in ‘poor’ or ‘very poor’ state of the whole watershed.