Major palaeoenvironmental and palaeoceanographical changes occurred during the Early Jurassic Toarcian Oceanic Anoxic Event (T-OAE), due to a perturbation of the global carbon cycle and a crisis in marine ecosystems. The sequence of environmental change and regional differences during the T-OAE are not yet fully understood and organic-walled phytoplankton and other palynomorphs are well-suited, but under-utilised, in research into this event. Based on quantitative palynological analyses from a black shale-bearing succession at Réka Valley in the Mecsek Mountains of southwest Hungary, five sequential palynomorph assemblages are distinguished. These reveal major shifts in organic-walled phytoplankton communities, driven by palaeoenvironmental changes. In addition, palynofacies analysis helped to document changes in the composition of sedimentary organic matter, and to quantify the terrestrial input. Assemblage 1 is characterised by a moderately diverse phytoplankton community and high levels of terrestrial palynomorphs. Assemblage 2 records a significant peak of the euryhaline dinoflagellate cyst Nannoceratopsis. Assemblage 3 is distinguished by dominance of highly opportunistic prasinophytes and the temporary disappearance of all dinoflagellate cyst taxa. Assemblages 4 and 5 represent distinctive phases of a prolonged recovery phase with low diversity phytoplankton assemblages and intermittently high levels of terrestrially-derived palynomorphs. The successive disappearance of phytoplankton taxa and the gradual takeover by opportunistic euryhaline species at the onset of the T-OAE were related to several phenomena. These include reduced salinity in the surface waters, establishment of a stable pycnocline and deterioration of nutrient recycling, followed by oxygen deficiency throughout much of the water column. The high amount of terrestrially-derived palynodebris indicates intense runoff and freshwater input, driven by the early Toarcian warming and the enhanced hydrological cycle. Comparison with coeval European successions proves that the palaeoenvironmental changes during the T-OAE were not entirely synchronous, and local factors played a crucial role in influencing phytoplankton communities. In the Mecsek Basin, regional freshening of the surface waters and increased terrestrial input due to the proximity of the hinterland had a greater influence on phytoplankton communities compared to the open oceanic setting of the Tethys to the south.