An important aim of fish ecology is to understand and predict patterns of distribution and abundance in marine communities. Such patterns were examined at four kelp-dominated sites along the northern coast of Chile (19° through 30° S) over 1 year. Fish species richness, diversity and abundance estimates obtained via observational and destructive sampling methods were compared among sites as were habitat and environmental variables that characterised the sites; including sea water temperature below the surface, nutrients, productivity, visibility, density of macroalgae stands, and percentage cover of observed microhabitats (including understorey algae and faunal assemblages). In total, 19 fish species belonging to 14 families were observed from all sites. Species richness and diversity were highest in sites where kelp canopy was composed of two species and where kelp was densest, although only species diversity was significantly different among sites. The sites with high kelp density, in turn, sustained abundant habitat-forming species in the kelp understorey. Principal coordinate analysis indicated that the composition and structure of the fish assemblages varied significantly with depth at all study sites. The depth distribution of fishes was correlated with the arrangement of site-specific biological microhabitats, defined by the algae or invertebrate species that form the microhabitat. Temperature, productivity, and nutrients did not vary consistently across study sites, but did vary within individual sites. We suggest that kelp cover and composition strongly affects the diversity and distribution of fishes at shallow coastal habitats in northern Chile through the availability of microhabitats.