ABSTRACT In April 2016, toxic chemicals leaked into the ocean in central Vietnam during a trial of a waste discharge system for a newly built steel plant. This resulted in a significant fish kill that impacted coastal livelihoods and the seafood sector across four provinces. We surveyed 520 households to understand how people experienced this environmental disaster, and their recovery strategies. On average people stopped all fishing-related activities for over nine months: this was a period of precarity for most households. Fish farming households suffered the greatest financial losses. Fishing households, while having a lower income, recovered more quickly than fish farming households since the mobility of boats and fishing grounds afforded flexibility and adaptability. In the longer term, relatively significant financial compensation from the company responsible for the spill made a difference to household recovery and their perceptions of the disaster. We argue that this toxic spill was a major stressor for coastal households in central Vietnam, and contribute to the precarity and the livelihood resilience literatures by offering a multi-dimensional perspective to understanding household recovery strategies. This study also draws attention to the importance of better understanding financial compensation as an aspect of recovery from human-induced disasters.