The observed high biomass of Sargassum species and other fleshy macroalgae on nearshore coral reefs in the Great Barrier Reef (Australia) raises the concern that this may be a sign of a phase shift from hard coral to dominance by algae, thus indicating the degradation of these reefs. Nearshore reefs are, due to their geographical position, exposed to inputs of nutrients and particles from mainland run-off. This study estimated the limiting and optimum nutrient concentrations for the growth of Sargassum baccularia under continuous supply of ammonium and phosphate. To assess the nutrient situation in the field, critical and subsistence levels of tissue nutrients as determined in cultures were compared with field tissue nutrient levels, and a 'mini budget' was estimated that compares nutrient requirements with nutrient supply. The growth rates of S. baccularia almost doubled within the narrow window of substrate concentrations from 3 mu M ammonium plus 0.3 mu M phosphate to 5 mu M ammonium plus 0.5 mu M phosphate. Lower and, unexpectedly, higher nutrient concentrations resulted in reduced growth rates. Field thalli of S. baccularia were always sufficiently supplied with N and P to show positive growth rates. However, field growth was both N- and P-limited, particularly in austral summer, when fast growth of S. baccularia occurs. This was indicated by tissue N and P concentrations that fell below the respective critical nutrient values, and estimated nutrient demands that exceeded the nutrients available from the water column. We suggest that if land-derived nutrient inputs increased, S. baccularia would become nutrient-sufficient, especially during the summer wet season. This may increase the competitive potential of this species to colonise larger areas on the nearshore reefs.