Eutrophication has become a serious concern in many lakes, resulting in cyanobacterial blooms. However, the mechanism and pathways of cyanobacteria decline are less understood. To identify and define the growth and decline of Microcystis blooms in Taihu Lake of China, and to illuminate the destination of surface floating blooms, we investigated the biomass distribution and variations in colony size, morphology, and floating velocity from October 2008 to September 2009. The results showed that the Microcystis bloom declined in response to biomass decrease, colony disaggregation, buoyancy reduction, and increased phytoplankton biodiversity, and these indicative parameters could be applied for recognition of the development phases of the bloom. Three major decline pathways were proposed to describe the bloom decline process, colony disaggregation (Pathway I), colony settlement (Pathway II), and cell lysis in colonies (Pathway III). We proposed a strategy to define the occurrence and decline of Microcystis blooms, to evaluate the survival state under different stress conditions, and to indicate the efficiency of controlling countermeasures against algal blooms.