In April 2015, dieback of young olive trees (Olea europaea L., cvs. Istarska bjelica and Buza) occurred in a private orchard near Vodnjan in Istria, Croatia. From total of 50 trees, eight (16%) showed symptoms of dieback, with branches that had vascular browning in cross section and attached light brown, downwardly curled leaves. A fungus was consistently isolated from surface sterilized wood pieces of diseased branches, obtained in pure cultures on potato dextrose agar (PDA) by monohyphal isolation, and incubated at 25°C in darkness. Colonies grew slowly (1.9 mm/day), and the initial white color became gradually dark. Microscopic analysis showed hyaline, septate hypha with conidiophores bearing phialides in verticillate arrangement producing hyaline, single-celled, ovoid to ellipsoid conidia, 4.8 ± 0.7 µm × 2.4 ± 0.4 µm (n = 100). Dark parts of the colonies showed abundant dark-brown microsclerotia embedded in PDA. Solitary microsclerotia (rounded, elongated, or irregular in shape) and their aggregates were 22 to 117 µm and up to 404 µm in diameter, respectively. Based on morphology, the fungus was identified as Verticillium dahliae Kleb. (Inderbitzin et al. 2011). For molecular identification, the representative isolate MTH4 was used for PCR amplification and sequencing of its ITS region (GenBank accession no. KX061497) using the primer pair ITS5/ITS4, showing 99.8% homology to reference isolate of V. dahliae (PD322, HQ206718) (Inderbitzin et al. 2011) and 100% homology to isolate SDV1025 (KC834733) (Yu et al. 2016), confirming identification based on morphology. Pathogenicity of eight isolates obtained in this study (MTH1 to MTH8) was tested on 2-year-old olive plants (cv. Oblica), three per isolate. Their roots were gently washed with tap water to remove soil and immersed for 1 h in conidial suspension (105 spores/ml) obtained from 10-day-old colonies on PDA. Control plants were treated with sterile water only. All the plants were potted in steam-sterilized soil and kept in greenhouse at 24 ± 2°C, around 70% relative humidity, and 15 h of daylight while watered twice a week. Inoculated plants, but not controls, showed leaf chlorosis after 4 to 5 weeks, and dieback by week six. Reisolations of V. dahliae from inoculated plants were attempted as described above and were successful for all but control plants, thus satisfying Koch’s postulates. This is the first report of V. dahliae causing dieback of olive in Croatia. During this study, it was observed that approximately 15% of olive trees in neighboring orchards also showed symptoms of dieback ; therefore, V. dahliae can be suspected as more widespread in Istria than was previously known, and control measures are needed. Diplodia seriata De Not., previously found to cause similar symptoms on young olive in Croatia (Kaliterna et al. 2012), was not found in this study.