A novel immunoassay was developed for specific detection of cyanobacterial cyclic peptide hepatotoxins which inhibit protein phosphatases. Immunoassay methods currently used for microcystin and nodularin detection and analysis do not provide information on the toxicity of microcystin and/or nodularin variants. Furthermore, protein phosphatase inhibition-based assays for these toxins are not specific and respond to other environmental protein phosphatase inhibitors, such as okadaic acid, calyculin A, and tautomycin. We addressed the problem of specificity in the analysis of protein phosphatase inhibitors by combining immunoassay-based detection of the toxins with a colorimetric protein phosphatase inhibition system in a single assay, designated the colorimetric immuno-protein phosphatase inhibition assay (CIPPIA). Polyclonal antibodies against microcystin-LR were used in conjunction with protein phosphatase inhibition, which enabled seven purified microcystin variants (microcystin-LR, -D-Asp³-RR, -LA, -LF, -LY, -LW, and -YR) and nodularin to be distinguished from okadaic acid, calyculin A, and tautomycin. A range of microcystin- and nodularin-containing laboratory strains and environmental samples of cyanobacteria were assayed by CIPPIA, and the results showed good correlation (R² = 0.94, P < 0.00001) with the results of high-performance liquid chromatography with diode array detection for toxin analysis. The CIPPIA procedure combines ease of use and detection of low concentrations with toxicity assessment and specificity for analysis of microcystins and nodularins.