We report the first observation of the fungal parasite of unicellular algae,Pseudosphaerita euglenae, in New Zealand. The parasite infection was observed in the Mangere oxidation pond algaeEuglena acusandEuglena polymorphaand increased potential for pond odour problems, posing a threat to pond operations.E. acuswas particularly susceptible to parasitism and was identified as the putative primary host; this is the first record ofP. euglenaeinfectingE. acus. Epidemic levels ofP. euglenaewere seasonal, lasting for 4–5 weeks from early November until late December of 1992 and 1993. Physico‐chemical parameters showing a significant relationship toE. acusinfection levels were temperature, cell numbers ofE. polymorphaandChlorella. Parameters associated withE. polymorphainfection were temperature, cell numbers ofE. polymorphaandChlorella, dissolved oxygen (a.m.), and negative redox potential. The calculated critical temperature forP. euglenaeinfection ofEuglenawas 17°C.