Hydropower dams are a source of renewable energy, but dam development and hydropower generation negatively affect freshwater ecosystems, biodiversity, and food security. We assess the effects of hydropower dam development on spatial–temporal changes in fish biodiversity from 2007 to 2014 in the Sekong, Sesan, and Srepok Basins—major tributaries to the Mekong River. By analyzing a 7-year fish monitoring dataset, and regressing fish abundance and biodiversity trends against cumulative number of upstream dams, we found that hydropower dams reduced fish biodiversity, including migratory, IUCN threatened and indicator species in the Sesan and Srepok Basins where most dams have been constructed. Meanwhile, fish biodiversity increased in the Sekong, the basin with the fewest dams. Fish fauna in the Sesan and Srepok Basins decreased from 60 and 29 species in 2007 to 42 and 25 species in 2014, respectively; while they increased from 33 in 2007 to 56 species in 2014 in the Sekong Basin. This is one of the first empirical studies to show reduced diversity following dam construction and fragmentation, and increased diversity in less regulated rivers in the Mekong River. Our results underscore the importance of the Sekong Basin to fish biodiversity and highlight the likely significance of all remaining free-flowing sections of the Lower Mekong Basin, including the Sekong, Cambodian Mekong, and Tonle Sap Rivers to migratory and threatened fish species. To preserve biodiversity, developing alternative renewable sources of energy or re-operating existing dams to increase power generation are recommended over constructing new hydropower dams.