In two montane watersheds that receive minimal deposition of atmospheric nitrogen, 15–71% of dissolved organic nitrogen (DON) was bioavailable in stream water over a 2-year period. Discharge-weighted concentrations of bulk DON were between 102 and 135 μg/l, and the C:N ratio differed substantially between humic and non-humic fractions of DON. Approximately 70% of DON export occurred during snowmelt, and 40% of that DON was biologically available to microbes in stream sediments. Concentrations of bioavailable DON in stream water were 2–16 times greater than dissolved inorganic nitrogen (DIN) during the growing season, and bioavailable DON was depleted within 2–14 days during experimental incubations. Uptake of DON was influenced by the concentration of inorganic N in stream water, the concentration of non-humic DON in stream water, and the C:N ratio of the non-humic fraction of dissolved organic matter (DOM). Uptake of DON declined logarithmically as the concentration of inorganic N in stream water increased. Experimental additions of inorganic N also caused a decline in uptake of DON and net production of DON when the C:N ratio of non-humic DOM was high. This study indicates that the relative and absolute amount of bioavailable DON can vary greatly within and across years due to interactions between the availability of inorganic nutrients and composition of DOM. DOM has the potential to be used biotically at a high rate in nitrogen-poor streams, and it may be generated by heterotrophic microbes when DIN and labile DOM with low relative nitrogen content become abundant.