While research on the hydrologic impact of different types of stormwater control measures (SCMs) is extensive, little research exists linking urbanization, widespread implementation of SCMs and channel stability in headwater streams. This study evaluated whether the unified stormwater sizing criteria (USSC) regulations in the state of Maryland, USA, which require the use of both end‐of‐pipe and distributed, small‐scale SCMs, protect channel stability. To achieve this goal, a coupled hierarchical modelling approach utilizing the Storm Water Management Model (SWMM) and the Hydrologic Engineering Center River Analysis System 6.3 (HEC‐RAS) was developed to predict changes in streamflow and sediment transport dynamics in a first‐order gravel‐bed, riffle‐pool channel. Storm event discretization revealed that 88% of observed storm events during the 16 years (2004–2020) had durations less than 18 h and that the greatest peak flows resulted from storm events with durations less than 24 h. HEC‐RAS simulation results also showed that both channel degradation and aggradation, as high as 1.2 m, will likely occur due to regulations which require the use of 24 h duration design storms with a target stormwater detention time rather than bed material sediment transport limits. Overall, this study provides valuable insights into the complex interactions between SCM practises, flow regimes and sediment transport dynamics in heavily urbanized watersheds. It is recommended that SCMs be designed using a continuous simulation model with at least 10 years of continuous rainfall data. Furthermore, to protect channel stability, the SCM design goal should focus on maintaining pre‐development sediment transport regimes across a range of flows. Urban stormwater regulations which require distributed stormwater controls to protect water quality and detention of a volume of runoff from frequent storm events do not protect receiving streams from long‐term channel degradation.