Goldstream River flows east along the Leech River Fault, which separates Jurassic to Cretaceous Leech River Complex (Formation) slates and schists to the north, from Tertiary Metchosin Volcanics to the south. The metasediments strike nearly west and dip steeply northeast. The Leech River Fault stretches from west of Victoria westward along the Leech River and Loss Creek valleys to the coast near Sombrio Point.

Placer gold occurs almost exclusively in the gravels of the streams that drain the area that is underlain by the slaty schists of the Jurassic to Cretaceous Leech River Complex (Formation). Fairly coarse gold may be found in the gravels of virtually all these streams. The gold in recent gravel deposits is likely derived from the numerous quartz veins that occur in the slaty schists. These veins are seldom more than small stringers and lenses a few centimetres wide and approximately 1 metre in length. The only metallic minerals in the veins are a little pyrite or chalcopyrite and free gold. The veins are generally too small and too barren to be profitably mined.

The topography shows that the river has cut down through the bedrock, leaving a series of gravel covered benches. It appears that most of the gold was derived from bars or in crevices in the bedrock of the river bed, or from benches along the side of the river.

The placer deposits were discovered in the late 1800’s in association with placer gold exploration on the island, following the discovery of the Leech River Placers (MINFILE 092B 078) in the 1860’s. Minor work by local prospectors has continued through to present. Former workings are reported below a water fall near the mouth of Waugh Creek and at a location referred to as “Japan” Gulch, located 4 kilometres southwest of the river mouth.

The entire river is located in Goldstream Park and the Greater Victoria Watershed.