Dam construction has large negative effects on biodiversity in river and riparian ecosystems worldwide. This study aimed to determine whether reservoir shorelines had lower plant species diversity and functional diversity than unregulated or lightly regulated riparian wetlands and to examine the responses of plant diversity and functional traits to reservoir shoreline environmental gradients. We surveyed 146, 44, and 67 plots on reservoir shorelines and in mainstem and tributary riparian wetlands, respectively, in a subtropical river–reservoir system. Species richness, functional richness, evenness, and divergence were calculated to reflect the species and functional diversity of plant communities. Environmental factors including elevation above water level, slope, landform type, substrate, disturbance, and cover were measured. The results showed that both species and functional richness were significantly lower on reservoir shorelines than in riparian wetlands. The relative species number of clonal plants and relative cover of annual plants were both negatively related to slope and elevation. Structural equation modeling and other statistical analyses indicated that most environmental factors had significant effects on species and functional richness on reservoir shorelines but had no significant effect on functional evenness and divergence. Our findings suggest that reservoir shoreline wetlands formed by damming rivers and inundating pre-existing riparian wetlands can be a biodiversity coldspot in regulated rivers at the plot level. Topographic factors are important in determining the plant diversity and vegetation establishment on reservoir shorelines in the Yangtze River basin.