Adult dispersal and completion of life cycles by aquatic insects are essential for the persistence of populations, colonization of new habitats, and maintenance of genetic diversity. However, life-cycle stages and processes associated with the terrestrial environment often are overlooked when the effect of watershed urbanization on the persistence of insects associated with streams is examined. We reviewed and synthesized current literature on the known effects of watershed urbanization on the terrestrial stage of stream insects. Some research has directly examined the effects of watershed urbanization on dispersal, but much of the evidence we present is indirect and from related studies on aquatic insect life-history traits and dispersal abilities in nonurban watersheds. Our goal is to provide examples of potential impacts that warrant further study, rather than to provide a comprehensive review of all life-history studies. We discuss how watershed land use, riparian condition, and habitat quality affect: 1) adult fitness, 2) adult dispersal, and 3) habitat fragmentation, and 4) how these factors interact with species traits. In general, we found that the local- and landscape-scale changes to stream, riparian, and upland habitats that typically result from anthropogenic activities have the potential to prevent the completion of aquatic insect life cycles and to limit adult dispersal, and therefore, can affect population persistence. When considered within the spatial context of dendritic stream networks, these effects, particularly those on adult dispersal, might have important implications for design and assessment of restoration projects. We discuss a framework for how to determine the relative importance of effects on specific life-cycle stages and processes for the absence of larval populations from urban streams. Overall, more research on terrestrial life-cycle stages and processes and on adult dispersal is required to understand how urbanization might affect population persistence of insects in urban streams.