Land use can influence stream sediment composition and water quality, whereas moisture status affects sediment phosphorus (P) bioavailability to algae. Declining upland surface-water quality in South Otago, New Zealand, may reflect land-use changes from sheep- to dairy-farming. I sampled sediment (0–20 cm) from streams draining 12 dairy- and 12 sheep-farmed catchments in spring (wet) and autumn (dry). 31P nuclear magnetic resonance (NMR) spectroscopy and the EDTA-fractionation scheme were used to determine different P forms and infer P bioavailability. Significantly more P was present in the sediment of streams draining dairy- than sheep-farmed catchments. Total P did not differ with the moisture regime; however, changes occurred in the following P fractions: acid-soluble organic P, NaOH-P, CaCO3≈P, Fe(OOH)≈P and residual organic P. Extraction for 31P NMR analysis removed 78–85% of sediment total P and isolated five P classes. More bioavailable P such as orthophosphate (23–40% of P extracted) and diesters (2–6% of P extracted) was present in dry than in wet sediments, and in sediments draining dairy streams than in those from sheep-farmed catchments. This indicates substantial reserves of bioavailable P in sediment from these catchments, especially from dairy-farmed catchments, sustaining in-stream P concentrations for many years even without additional P input from land.