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Wood additions to streams can slow water velocities and provide depositional areas for bacteria and fine particles (e.g., particulate organic carbon and nutrients sorbed to fine sediment), therefore increasing solute and particle residence times. Thus, wood additions are thought to create biogeochemical hotspots in streams. Added wood is expected to enhance in‐stream heterogeneity, result in more complex flow paths, increase natural retention of fine particles and alter the geomorphic characteristics of the stream reach. Our aim was to directly measure the impact of wood additions on fine particle transport and retention processes. We conducted conservative solute and fluorescent fine particle tracer injection studies in a small agricultural stream in the Whatawhata catchment, North Island of New Zealand in two reaches—a control reach and a reach restored 1‐year earlier by means of wood additions. Fine particles were quantified in surface water to assess reach‐scale (channel thalweg) and habitat‐scale (near wood) transport and retention. Following the injection, habitat‐scale measurements were taken in biofilms on cobbles and by stirring streambed sediment to measure fine particles available for resuspension. Tracer injection results showed that fine particle retention was greater in the restored compared to the control reach, with increased habitat‐scale particle counts and reach‐scale particle retention. Particle deposition was positively correlated with cobble biofilm biomass. We also found that the addition of wood enhanced hydraulic complexity and increased the retention of solute and fine particles near the wood, especially near a channel spanning log. Furthermore, particles were more easily remobilized from the control reach. The mean particle size remobilized after stirring the sediments was ~5 μm, a similar size to both fine particulate organic matter and many microorganisms. These results demonstrate that particles in this size range are dynamic and more likely to remobilize and transport further downstream during bed mobilization events. [ABSTRACT FROM AUTHOR]