The ability of Palaemonetes pugio to consume microalgae in marshes of Spartina alterniflora was examined in field collections and laboratory experiments. Photosynthetic pigment (chlorophyll a and phaeopigments) content in P. pugio was measured after shrimp exoskeletons were removed to ensure that pigments were primarily from gut contents. Gut pigment was detectable in all 88 field-collected specimens examined, and was found at high levels in many individuals (much higher than shrimp starved for 24 h). Pigment content was positively correlated with shrimp size and was highly variable. Adults contained from 0.056-3.03 and subadults from 0.016-2.41 mu g pigment shrimp(-1), 14% of which was in the form of chlorophyll a. Highest pigment levels were associated with adult grass shrimp collected at 1500 h; pigment content at 0300 h was significantly lower. The ability of P. pugio to consume microalgae from various sources was examined in the laboratory with C-14-labeled microalgae and gut-pigment analysis. Palaemonetes pugio consumed two species of cultured, C-14-labeled phytoplanktan, but with low efficiency at even very high concentrations. For Thalassiosira weissflogii, 2.5%, and for Isochrysis galabana, 0.07% of the available cells were consumed in 1-h trials at high concentrations of algae. Unvegetated, mudflat sediment (with a high abundance of benthic algae) was collected and labeled with C-14 bicarbonate. Incorporation of label above background was detected in a low percentage of shrimp, and average grazing rates were very low (near detection limits), suggesting that grass shrimp are not efficient grazers of the microphytobenthos. Spartina alterniflora stems with C-14-labeled epiphytic algae were also offered to grass shrimp. Grazing was highly efficient (a substantial fraction of the available epiphytic algae was consumed), and pigment content was similar to held-collected shrimp. These results suggest that microalgae may significantly contribute to the diet of grass shrimp, and that a likely source for the photosynthetic pigments in the gut contents of held-collected P: pugio is the epiphytic algae on stems of Spartina alterniflora.