The development of waterways or dam constructions without doing an environmental impact assessment (EIA) and fish ladder construction, alteration of the aquatic environment, degradation of the quality of environmental variables, habitat modification, and increasing fishing pressure have accelerated the vulnerability of fish in Nepal. To assess the impact of Betani River Dam on fish diversity and environmental parameters two major sampling stations were allocated along the sampling stretch with equal four sub-stations. Four sub-stations at the upstream and four at the downstream. Sampling was conducted monthly from August 2020 to January 2021. A total of 6088 individuals, representing 29 species, were recorded in all catch samples. The species comprised 20 genera, 13 families and four orders. Of 29 fish species, the similarity percentage analysis (SIMPER) indicated that Puntius sophore (22.04%), P. ticto (10.67%), Lepidocephalus guntea (9.27%), Danio devario (8.02%), Puntius terio (7.52%), Barilius barila (6.49%) and Mystus tengera (6.32%) were the major contributing fish species reported from Betani River.  Analysis of similarity (ANOSIM) for space and time indicated that there was a significant difference in spatial variation (R = 0.1946, P = 0.0001), but none was recorded in time variation (R = 0.01703, P = 0.3). One way analysis of similarity (ANOSIM) on the non-metric multidimensional scaling (NMDS) pointed a significant difference (R=0.29, P=0.0001) between upstream and downstream of fish community structure in Betani River.