We show that the cyanobacterial symbionts of a tripartite cyanolichen can produce hepatotoxic microcystins in situ. Microcystins were detected with high-performance liquid chromatography mass spectrometry both from cephalodia of the tripartite cyanolichen Peltigera leucophlebia and from a symbiotic Nostoc strain isolated from the same lichen specimen. Genetic identities of symbiotic Nostoc strains were studied by amplifying and sequencing the 16S rRNA gene. Also, the presence of the microcystin synthetase gene mcyE was confirmed by sequencing. Three highly toxic microcystins were detected from the lichen specimen. Several different Nostoc 16S rRNA haplotypes were present in the lichen sample but only one was found in the toxin-producing cultures. In culture, the toxin-producing Nostoc strain produced a total of 19 different microcystin variants. In phylogenetic analysis, this cyanobacterium and related strains from the lichen thallus grouped together with a previously known microcystin-producing Nostoc strain and other strains previously isolated from the symbiotic thalloid bryophyte Blasia pusilla. Our finding is the first direct evidence of in situ production of microcystins in lichens or plant-cyanobacterial symbioses. Microcystins may explain why cyanolichens and symbiotic bryophytes are not among the preferred food sources of most animal grazers.