In degraded coral reef ecosystems, allelopathic macroalgae have received increasing attention from marine ecologists because their secondary metabolites (also known as allelochemicals) kill corals that grow adjacent to them and weaken the recovery of degraded reefs. One well‐known coral‐killing macroalga is the calcareous red seaweed Galaxaura . However, our knowledge of how coral reef fishes interact with allelopathic algae like Galaxaura is very limited. Here, we documented novel observations of feeding interactions of 17 species of coral reef fishes (herbivorous and carnivorous) with the filamentous Galaxaura divaricata on degraded lagoon patch reefs in Dongsha Atoll (South China Sea). Video analyses showed that territorial farming damselfishes (i.e., Dischistodus perspicillatus , D. prosopotaenia , Hemiglyphidodon plagiometopon , Pomacentrus grammorhynchus , P. adelus , and Neoglyphidodon nigroris ) and juvenile parrotfishes ( Scarus schlegeli , S. ghobban , S. rivulatus , and Chlorurus spilurus ) likely used G. divaricata as a feeding substratum. Further, microscopic analyses revealed that the filamentous surface of G. divaricata harbored a wealth of epiphytic microalgae, such as filamentous cyanobacteria (i.e., Leptolyngbya , Lyngbya , Rivularia , Oscillatoria , and Stigonema ), diatoms (i.e., Synedra , Nitzschia , Mastogloia , and Pleurosigma ), and filamentous red algae (i.e., Heterosiphonia ), suggesting that these fishes targeted the nutrient‐rich microscopic epiphytes rather than the nutrient‐poor host. Juvenile benthic carnivores (i.e., Labridae, Parupeneus multifasciatus , and Meiacanthus grammistes ) form feeding assemblages with roving parrotfishes to feed on small invertebrates (i.e., amphipods, copepods, isopods, gastropods, and polychaetes) associated with G. divaricata . Given that coral reef fishes appear to target the epiphytes associated with Galaxaura rather than the alga itself, these observations thus substantiate the threat posed by the overgrowth of G. divaricata to coral recovery in degraded reef systems due to the lack of natural grazers.