The subtidal algal and seagrass communities of Waterloo Bay on the west coast of Eyre Peninsula, South Australia, are described. Their distribution, together with that of the dominant or common species, is related to substrate, degree of water movement and to depth (i.e. to light). Observations were mostly limited to the month of October from 1969 to 1974. Notes are also given on intertidal communities of the platforms near and just inside the heads of the Bay. The Bay is more or less circular and some 2.5 km 2 in area, partly separated from the open sea by a submerged reef. Depths in the centre of the Bay are about 10 m, and the bar reef slopes off to a sandy sea-floor at about 27 m deep. Sea conditions are rough (i.e. high energy) at the entrance to the Bay and on the rock platforms there, and decrease to moderate within the Bay. Sea temperatures range from 14–15°C inter to 18–20°C in summer. By means of Scuba diving, an underwater sled and numerous spot dives (involving 71 samples for detailed analysis), six algal communities and five seagrass communities were recognized and mapped. Communities on upward facing substrate were studied, with some attention being given to algae on vertical surfaces. Communities were recognized by and named after their dominants, the latter being distinguished by abundance, size and biomass. Some communities are sharply separated from others, largely due to change in substrate, while others intergrade more gradually as water movement or depth changes. Most of the algal communities within the Bay are dominated by the larger brown algae, especially species of Cystophora, Ecklonia and Scaberia. On sandy substrate, the seagrass communities are dominated by Heterozostera tasmanica, Amphibolis antarctica or by species of Posidonia. Considerable changes (probably due to storm damage) in the seagrass beds were evident between 1974 and 1979, and suggestions are made with regard to succession in these seagrass communities. Detailed analyses of distributions of species support the recognition and mapping of communities. Changes in biomass, coverage, species richness, percentage similarity and dominance within communities were related to the degree of water movement and to depth. The algal biomass in Waterloo Bay is comparable with that in shallow water of temperate coasts elsewhere in the world, and somewhat greater than that at depths of 10–20 m in either temperate or tropical waters. Coverage of the algal and seagrass communities is high, and in no areas of the Bay are animals dominant. On the outer reef slope, algal communities are still dominant at about 27 m deep, below which the bottom is sandy. Rates of change in algal communities along environmental gradients were generally low within the restricted depth ranges in the Bay, and highest near the extremes of the water movement gradient. Species richness of the upper stratum is greatest in shallow water at intermediate water movement, and richness of the middle stratum is the reverse, being greatest at the extremes of this gradient. On the depth gradient, species richness is highest at 5–10 m deep. Dominance is a major factor determining structure of the communities, and strong dominance of a few species with high upper stratum coverage leads tolow middle stratum coverage of few species. Most subtidal communities have two or more co-dominants and there is little evidence for ‘competitive exclusion’ resulting in a single dominant in these communities. The peaks and limits of individual species were scattered along the gradients with extensive overlaps. Clustering of the distributional limits corresponded to changes between communities. Most common middle and lower stratum species occur over a relatively wide range of conditions, without strong peaks of abundance. With increasing slope, upper stratum dominance declines and species richness of the middle stratum increases. In some areas, sand cover or abrasion occurs and here only sand tolerant species occur. Grazing effects are not prominent and overgrazing (largely due to molluscs) was only observed on areas of the submerged reef at the entrance of the Bay. The algal flora of Waterloo Bay is rich, and 364 species are listed in the Appendix.