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Biodiversity is changing at an accelerating rate at both local and regional scales. Beta diversity, which quantifies species turnover between these two scales, is emerging as a key driver of ecosystem function that can inform spatial conservation. Yet measuring biodiversity remains a major challenge, especially in aquatic ecosystems. Decoding environmental DNA (eDNA) left behind by organisms offers the possibility of detecting species sans direct observation, a Rosetta Stone for biodiversity. While eDNA has proven useful to illuminate diversity in aquatic ecosystems, its utility for measuring beta diversity over spatial scales small enough to be relevant to conservation purposes is poorly known. Here we tested how eDNA performs relative to underwater visual census (UVC) to evaluate beta diversity of marine communities. We paired UVC with 12S eDNA metabarcoding and used a spatially structured hierarchical sampling design to assess key spatial metrics of fish communities on temperate rocky reefs in southern California. eDNA provided a more-detailed picture of the main sources of spatial variation in both taxonomic richness and community turnover, which primarily arose due to strong species filtering within and among rocky reefs. As expected, eDNA detected more taxa at the regional scale (69 vs. 38) which accumulated quickly with space and plateaued at only ~ 11 samples. Conversely, the discovery rate of new taxa was slower with no sign of saturation for UVC. Based on historical records in the region (2000–2018) we found that 6.9 times more UVC samples would be required to detect 50 taxa compared to eDNA. Our results show that eDNA metabarcoding can outperform diver counts to capture the spatial patterns in biodiversity at fine scales with less field effort and more power than traditional methods, supporting the notion that eDNA is a critical scientific tool for detecting biodiversity changes in aquatic ecosystems.