Urbanization results in major changes in stream morphology, hydrology, and water quality; the consequences on fish assemblage of Neotropical urban streams remain poorly understood. Due to the importance of better understanding fish assemblage responses towards urbanization in biodiversity hotspots, we evaluated the factors structuring the fish assemblages in a Neotropical medium-sized city. Additionally, we evaluated possible differences in fish diversity and biotic homogenization between the urban and control streams. To do so, fish were sampled along with physical habitat and water quality parameters in 16 urban streams in southern Brazil. Multiple regression and distance-based linear models (DistLM) were used to assess the importance of predictor variables in determining species richness and fish assemblage composition, respectively. The fish abundance rank curves were plotted to evaluate graphic differences in fish diversity between urban and control streams, while the relationship between distance and similarity (Bray-Curtis index) was used to evaluate biotic homogenization. The results revealed the importance of variables linking habitat diversity and basin connectivity to fish assemblage richness and structure. In addition, riparian vegetation was the main driver of fish assemblages, explaining 78% of abundance variation. We identified lower diversity and higher biotic homogenization in urban streams, with higher dominance of the non-native species Poecilia reticulata. Our results highlight the importance of evaluating the physical and biotic variables of streams outside of water pollution levels alone. Finally, it is necessary to support urban planning practices that recover riparian vegetation, avoid canalization, and promote connectivity along stream networks as well as the removal of artificial structures in urban basins.