Harmful cyanobacterial bloom occurrences have increased worldwide due to climate change and eutrophication, causing nuisance and animal deaths. Species from the benthic cyanobacterial genus Microcoleus are ubiquitous and form thick mats in freshwater systems, such as rivers, that are sometimes toxic due to the production of potent neurotoxins (anatoxins). Anatoxin-producing (toxic) strains typically coexist with non-anatoxin-producing (nontoxic) strains in mats, although the reason for this is unclear. To determine the genetic mechanisms differentiating toxic and nontoxic Microcoleus, we sequenced and assembled genomes from 11 cultures and compared these to another 31 Microcoleus genomes. Average nucleotide identities (ANI) indicate that toxic and nontoxic strains are distinct species (ANI, <95%), and only 6% of genes are shared across all 42 genomes, suggesting a high level of genetic divergence among Microcoleus strains. Comparative genomics showed substantial genome streamlining in toxic strains and a potential dependency on external sources for thiamine and sucrose. Toxic and nontoxic strains are further differentiated by an additional set of putative nitrate transporter (nitrogen uptake) and cyanophycin (carbon and nitrogen storage) genes, respectively. These genes likely confer distinct competitive advantages based on nutrient availability and suggest nontoxic strains are more robust to nutrient fluctuations. Nontoxic strains also possess twice as many transposable elements, potentially facilitating greater genetic adaptation to environmental changes. Our results offer insights into the divergent evolution of Microcoleus strains and the potential for cooperative and competitive interactions that contribute to the co-occurrence of toxic and nontoxic species within mats. IMPORTANCE Microcoleus autumnalis, and closely related Microcoleus species, compose a geographically widespread group of freshwater benthic cyanobacteria. Canine deaths due to anatoxin-a poisoning, following exposure to toxic proliferations, have been reported globally. While Microcoleus proliferations are on the rise, the mechanisms underpinning competition between, or coexistence of, toxic and nontoxic strains are unknown. This study identifies substantial genetic differences between anatoxin-producing and non-anatoxin-producing strains, pointing to reduced metabolic flexibility in toxic strains, and potential dependence on cohabiting nontoxic strains. Results provide insights into the metabolic and evolutionary differences between toxic and nontoxic Microcoleus, which may assist in predicting and managing aquatic proliferations.

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