Many organisms have developed defences to avoid predation by species at higher trophic levels. The capability of primary producers to defend themselves against herbivores affects their own survival, can modulate the strength of trophic cascades and changes rates of competitive exclusion in aquatic communities. Algal species are highly flexible in their morphology, growth form, biochemical composition and production of toxic and deterrent compounds. Several of these variable traits in phytoplankton have been interpreted as defence mechanisms against grazing. Zooplankton feed with differing success on various phytoplankton species, depending primarily on size, shape, cell wall structure and the production of toxins and deterrents. Chemical cues associated with (i) mechanical damage, (ii) herbivore presence and (iii) grazing are the main factors triggering induced defences in both marine and freshwater phytoplankton, but most studies have failed to disentangle the exact mechanism( s) governing defence induction in any particular species. Induced defences in phytoplankton include changes in morphology (e.g. the formation of spines, colonies and thicker cell walls), biochemistry (such as production of toxins, repellents) and in life history characteristics (formation of cysts, reduced recruitment rate). Our categorization of inducible defences in terms of the responsible induction mechanism provides guidance for future work, as hardly any of the available studies on marine or freshwater plankton have performed all the treatments that are required to pinpoint the actual cue(s) for induction. We discuss the ecology of inducible defences in marine and freshwater phytoplankton with a special focus on the mechanisms of induction, the types of defences, their costs and benefits, and their consequences at the community level.