An endangered species of crayfish has been found breeding in a Leeds stream that until recently was the source of complaints about floating raw sewage. Conservationists claimed today that the discovery of the white clawed crayfish in the Meanwood Beck in the rundown Sheepscar area of the city signals the success of a clean-up operation of the urban waterway.

In early 1990s, residents in the area frequently complained about the sight of raw sewage in the beck. And in 1999, thousands of litres of oil seeped into the stream from a leak in a tank at a Leeds University hall of residence.

The poor quality of the water threatened to drive out the white claw crayfish, a species that is under threat nationally from colonisation by American red signal crayfish. But the now Environment Agency has announced that the native crustacean is thriving in the Meanwood Beck.

The discovery came after Leeds city council applied to clear up debris form the stream. Before the work was carried out, checks were made for the presence of crayfish. Staff from the agency found several white claws, including a female carrying eggs, and moved them to safety.

Martin Christmas, the Environment Agency's biodiversity specialist, said: "The upper more rural parts of Meanwood Beck have long been recognised as one of the most important sites for white claws in West Yorkshire, but their habitat in the beck has been restricted because of the poor quality of the water in more urban sections."

He pointed out that the water quality had benefited from improvements by Yorkshire Water to sewage and rainwater overflows in the area. He added: "All this means that one of the country's endangered species is establishing a foothold in an unlikely looking area." Last year in East Anglia conservationists began a trapping and extermination programme of American red signal crayfish in an effort to protect the white clawed variety.

The larger American species is now found in almost 90% of British waterways after being imported for farming. Conservationists fear that, unless it is controlled, it will wipe out the British white claws within 30 years.