Restoration of natural processes in ecosystems is key to mitigate the biodiversity crisis. Here, we evaluate 20 Danish stream-valley restoration projects—mainly by rewetting—in terms of successful restoration of natural wetland habitats. We used quadratic discriminant analysis and generalized linear models to compare 80 vegetation plots from the restoration projects with >60,000 natural or semi-natural wetland reference plots. We modeled the influence of time since restoration, grazing, rewetting, and nutrient availability on (1) the probability that study plots belong to natural habitats and (2) their richness of high-quality-habitat indicator species. The probability of a restored wetland having developed into a natural wetland habitat—such as an alkaline fen—was generally below 10%. Also, we found only half as many indicator species in restored wetlands than in reference wetlands and we demonstrated that the number of characteristic alkaline fen species did not deviate from what could be expected under the prevailing nutrient conditions. We found a negative effect of soil nutrient availability on the number of high-quality-habitat indicator species and the lowest probability of plots being natural wetlands in the most nutrient rich plots. The effect of grazing was only positive in the first years after restoration and only in the most nutrient rich plots, while the effect of rewetting sites to historical hydrological conditions was generally negative. Our findings suggest that unnaturally high nutrient availability is probably the core limiting factor for successful restoration of natural wetlands and their associated plant diversity.