In lakes, benthic micro-algae and cyanobacteria (periphyton) can contribute significantly to total primary productivity and provide important food sources for benthic invertebrates. Despite recognition of their importance, few studies have explored the diversity of the algal and cyanobacterial composition of periphyton mats in temperate lakes. In this study, we sampled periphyton from three New Zealand lakes: Tikitapu (oligotrophic), Ōkāreka (mesotrophic) and Rotoiti (eutrophic). Statistical analysis of morphological data showed a clear delineation in community structure among lakes and highlighted the importance of cyanobacteria. Automated rRNA intergenic spacer analysis (ARISA) and 16S rRNA gene clone libraries were used to investigate cyanobacterial diversity. Despite the close geographic proximity of the lakes, cyanobacterial species differed markedly. The 16S rRNA gene sequence analysis identified eight cyanobacterial OTUs. A comparison with other known cyanobacterial sequences in GenBank showed relatively low similarities (91–97%). Cyanotoxin analysis identified nodularin in all mats from Lake Tikitapu. ndaF gene sequences from these samples had very low (≤ 89%) homology to sequences in other known nodularin producers. To our knowledge, this is the first detection of nodularin in a freshwater environment in the absence of Nodularia. Six cyanobacteria species were isolated from Lake Tikitapu mats. None were found to produce nodularin. Five of the species shared low (< 97%) 16S rRNA gene sequence similarities with other cultured cyanobacteria.