Previous studies have shown that under laboratory conditions, dissolved organic matter (DOM) leached from plants can be differentially more phytotoxic to cyanobacteria, compared to green algae. This study examined how DOM source and transformation processes (microbial and photochemical) affect its chemical composition and phytotoxicity towards a cultured species of cyanobacteria (Raphidiopsis raciborskii) using a factorial experimental design. To complement cyanobacterial bioassays, the chemical composition and associated changes in DOM were determined using spectroscopic (nuclear magnetic resonance (NMR) and absorbance) and elemental analyses. Sunlight exposed DOM from leaves of the terrestrial plants, Casuarina cunninghamiana and Eucalyptus tereticornis had the most phytotoxic effect compared to DOM not exposed to sunlight. This phytotoxic DOM was characterised by relatively low nitrogen content, containing highly coloured and relatively high molecular mass constituents. Both mixed effect model and PCA approaches to predict inhibition of photosynthetic yield indicated phytotoxicity could be predicted (P < 0.001) based upon the following parameters: C: N ratio; gilvin, and lignin-derived phenol content of DOM. Parallel proton-detected 1D and 2D NMR techniques showed that glucose anomers were the major constituents of fresh leachate. With ageing, glucose anomers disappeared and products of microbial transformation appeared, but there was no indication of the appearance of additional phytotoxic compounds. This suggests that reactive oxygen species may be responsible, at least partially, for DOM phytotoxicity. This study provides important new information highlighting the characteristics of DOM that link with phytotoxic effects.