Competition among phytoplankton for limiting resources may involve direct or indirect interactions. A direct interaction of competitors is the release of chemicals that inhibit other species, a process known as allelopathy. Here, we investigated the allelopathic effect of three toxic microalgae species (Alexandrium tamarense, Karenia mikimotoi and Chrysochromulina polylepis) on a natural population of the dinoflagellate Scrippsiella trochoidea. Our major findings were that in addition to causing death of S. trochoidea cells, the allelopathic species also induced the formation of temporary cysts in S. trochoidea. Because cysts were not lysed, encystment may act as a defence mechanism for S. trochoidea to resist allelochemicals, especially when the allelopathic effect is moderate. By forming temporary cysts, S. trochoidea may be able to overcome the effect of allelochemicals, and thereby have an adaptive advantage over other organisms unable to do so.