The aims of this study were to investigate the population dynamics and distribution of cyanobacteria in three New Zealand lakes, to detect the presence of microcystin-producing mcyE genes in potentially toxigenic strains and to correlate the finding with microcystin production. A total of 18 samples collected over a 6-week period from Lakes Rotorua, Rotoiti and Rotoehu were found to be predominantly composed of Microcystis spp., Anabaena spp., Coelosphaerium spp. and Aphanocapsa spp. The 820-bp-long region of the microcystin synthetase gene (mcyE) was successfully amplified for 11 out of the 18 water samples in genera of Microcystis and Anabaena. This provides the first documented evidence of Anabaena sp. carrying the potential to produce microcystins in New Zealand. Microcystin-LR was the only variant detected by matrix-assisted laser desorption/ionisation time-of-flight mass spectrometry (MALDI-TOF MS) analysis and was present in all samples from Lake Rotoehu.