Fine spatial and temporal phytoplankton variability in Mali Ston Bay has been observed for the first time based on physicochemical properties and small herbivorous zooplankton. Extensive year-through research was conducted during 2002 at Usko station which is traditionally an area of intensive shellfish farming. The Neretva River inflow, submarine springs ("vruljas") and precipitation are additional sources of nutrients in the bay. Temperature and salinity, combined with total inorganic nitrogen (TIN) were observed to be the most important environmental factors driving the succession of phytoplankton communities. Orthophosphate was a potential limiting factor for phytoplankton development. The nanophytoplankton abundances, as well as the microphytoplankton diatoms are controlled by herbivorous zooplankton grazing ('top-down' control) more than other groups of microphytoplankton. Nanophytoplankton dominated phytoplankton abundance and its most intensive development was recorded in winter and spring, while increase in microphytoplankton abundance occurred in spring and autumn. Diatoms dominated microphytoplankton abundance mostly in winter and autumn, while dinoflagellates dominated in spring and summer. Considering the number of taxa and abundance, dinoflagellates were the dominant microphytoplankton group during the year and were the main component of the spring blooms. At that time, in conditions of elevated temperature (>16 °C), decreased salinity (34-36) and increased concentrations of TIN, blooms of harmful dinoflagellate Prorocentrum minimum were recorded for the first time in the bay. The results showed a significant difference in environmental conditions, as well as in the annual phytoplankton succession and community structure, as compared with studies carried out more than 20 years ago in this area.