The efficiency of ozonation in comparison to chlorination for removal of microcystins and production of trihalomethanes (THMs) in water was investigated. One hundred and ninety water samples of ozone and chlorine treated water were collected at a water treatment plant between August 2004 and March 2005. The level of THMs, total organic carbon and residual chlorine were determined. Protein phosphatase 2A inhibition assay was used to detect microcystins and the presence of microcystins was confirmed by HPLC. The results show that 91.5% of the THM species in treated water was chloroform and 8.5% was bromodichloromethane. The mean THM level± standard error of mean in chlorinated water (CW) (45.1±3.0 μg/L) was higher than the mean of THM level in ozonated water (OW) (18.6±2.2 μg/L). In addition, no OW sample exceeded the first stage U.S. EPA maximum THM contaminant level for drinking water (80 μg/L) and only 8% of these samples exceeded the second stage level (40 μg/L). On the other hand, 3% of CW samples exceeded 80 μg/L and 68% exceeded the 40 μg/L level. The microcystin level in all water samples was below the WHO guideline value (1 μg/L) for drinking water.