This study was conducted to monitor the adverse effect of the drainage wastewater of three main factories on the macroinvertebrates biodiversity of Ismailia Canal. Water and benthos samples were collected seasonally during 2010 from 10 stations along Ismailia Canal from El-Mezalat to Abu Zaabal city.The results revealed that most of the physico-chemical parameters were within the permissible limits, although, Cairo Power station and Abu Zaabal factory are causing partial pollution. The community of macrobenthic invertebrates was represented by Mollusca (35.20 %), Annelida (33.62 %) and Arthropoda (31.18 %). Limnodrilus hoffmeisteri and Chironomus larvae were dominating the whole studied area (32% and 28.51% of total macrobenthos, respectively) and they are considered to be potential bioindicators for polluted ecosystem. Low species diversity and occurrence of pollution-tolerant species (e.g. Limnodrilus hoffmeisteri and Chironomus larvae) indicate that the water quality of the canal is deteriorated. A regular program for biomonitoring is recommended which will allow future changes and enhancing in this important ecosystem.