Cyanobacterial harmful algal blooms (cyano-HAB) and microcystins (MCs) can cause a potential threat to public health. Here, a method for simultaneous removal of cyano-HAB and MCs was developed using chitosan-modified local soil (MLS) flocculation plus microorganism-modified soil capping. The experiment was conducted in simulated columns containing algal water collected from Lake Taihu (China). More than 90% of algal cells and intracellular MCs were flocculated and removed from water using chitosan-MLS and the sunken flocs were treated by different capping materials including Pseudomonas sp. An18 modified local soil. During 40 days of incubation, dissolved MC-LR and MC-RR showed 10-fold increase in the flocculation-only system. The increase of MC-LR and MC-RR in water was reduced by 30 and 70% in soil capping treatments; however, the total content of MCs in the sediment-water column remained similar to that in the control and flocculation only systems. In contrast, both dissolved MCs and total MCs were reduced by 90% in Pseudomonas sp. An18 modified soil capping treatment. The high performance of toxin decomposition was due to the combined effects of flocculation and MC-degrading bacteria that embedded in the capping material, which prevents dilution of bacteria biomass, concentrates algal cells, confines released toxins, and enhances toxin biodegradation.