Sediment bypassing connects the upstream and downstream regions of dam impoundments through tunnels and is expected to partly restore natural processes (flood pulse and sediment regime) in dam‐altered river ecosystems. However, few reports examined the effects of restoration on stream biota. We examined the effectiveness of repeated sediment bypassing (12 times) over a period of 5 years in a Japanese dammed river using a before‐after‐reference‐impact design. We compared the abiotic parameters (water quality and substrate environment), biotic assemblages (algae, macroinvertebrates, and fish), and similarities between the dam downstream and undammed reference reaches. The reference sites exhibited high temporal variability in abiotic environments and species composition over the 5‐year period. Most abiotic and biotic parameters downstream of the dam improved and approached those of the changing reference states. However, these indices returned to pretrial conditions after the last trial. Biotic similarities between the downstream and reference reaches gradually increased throughout successive sediment‐bypassing trials for macroinvertebrates and algae; however, these similarities diminished after the last trial. Conversely, the abundance‐based composition of fish assemblages in the restored reach consistently diverged from that of the reference conditions throughout the study period. Our results show that the success and failure of restoration by sediment bypassing may be affected by the amount of bedload in the flushing flows and other regional processes such as migratory connectivity. Sediment bypassing can partially re‐establish natural processes and is a useful tool for improving sediment‐associated environments and biota.