The bloom-forming cyanobacterium Microcystis occurs mainly as colonial aggregates under the natural conditions. This paper investigated the hydrophobicity and iron coagulation of extracellular polymeric substances (EPSs) from colonial Microcystis in order to understand the impact of EPS on the water treatment process. The higher contents of dissolved EPS (dEPS) and bound EPS (bEPS, mucilaginous matrix around the cells), lower dEPS/bEPS ratio and greater negative zeta potential of bEPS and dEPS were found in colonial Microcystis compared with unicellular Microcystis. XAD resin fractionation analysis indicated that the hydrophobicity could be ranked in an order as follows: bEPS > dEPS > dissolved extracellular organic matter (dEOM) for all the Microcystis strains. Correlation analysis showed that there was a statistically significant correlation between the amounts of carbohydrate and dissolved organic carbon in the hydrophobic fraction of EOM (dEOM, dEPS and bEPS), indicating that the hydrophobicity of Microcystis EOM might be related to carbohydrate. The coagulation experiment showed that for each colonial Microcystis strain, the removal efficiency of bEPS was higher than that of dEPS within the pH range from 3 to 10. The implications of the EPS characteristics were further discussed with respect to water treatment.