The influence of toxic microcystis on the life processes of Daphnia magna was studied in a series of in vitro and in situ life table experiments. Using survival, body growth and fecundity as response parameters, the performance of D. magna incubated in suspensions of the toxic Microcystis aeruginosa CYA 228/1 (2 mg microcystin/g algal DW) and lake water containing natural Microcystis was compared to the performance of D. magna incubated in a high quality food suspension of Scenedesmus acutus and yeast and in tap water without addition of food. Accumulation of microcystin in D. magna was quantified by ELISA. Additional experiments were performed to study the grazing of D. magna in food suspensions containing varying quantities of M. aeruginosa CYA 228/1 mixed with S. acutus. The presence of M. aeruginosa CYA 228/1 reduced the survival of D. magna by 85100 % in the in situ life table experiments. No significant reduction was recorded in the in vitro experiments. M. aeruginosa CYA 228/1 reduced the growth and fecundity of D. magna in all experiments. Microcystin was detected in all D. magna populations incubated in food suspensions containing indigenous or cultured Microcystis. A strong negative correlation between toxin concentration and body length were found (r² = 0.72) as well as a weaker negative correlation between toxin concentration and fecundity (r² = 0.48) expressed as biovolume specific concentrations. These findings indicate that 1) microcystin has direct toxic effects on Daphnia life processes, 2) microcystin can accumulate in Daphnia and 3) Daphnia can potentially act as vectors for the transfer of microcystin to higher trophic levels in the aquatic food web. A possible pathway for the transfer of microcystin from the food particles to the daphniid body is suggested.