Microseira wollei, a globally distributed freshwater bloom-forming benthic cyanobacterium, is known for its production of cyanotoxins and taste and odor (T&O). While CYN (Cylindrospermopsin)-producing populations of M. wollei are confined to Australia, PST (Paralytic shellfish toxins)-producing populations have been exclusively documented in North America. In this study, four benthic cyanobacterial strains, isolated from West Lake in China, were identified as M. wollei based on morphological and phylogenetic analyses. Detection of sxtA gene and UPLC-MS/MS analysis conclusively confirmed the PST-producing capability of M. wollei CHAB5998. In the phylogenetic tree of 16S rDNA, M. wollei strains formed a monophyletic group with two subclades. Notably, non-PST-producing Chinese strains clustered with Australian strains in Clade II, while all other strains, including PST-producing ones, clustered in Clade I. Additionally, CHAB5998 contains ten PST variants, of which STX, NEO, GTX2, GTX3, GTX5 and C1 were identified for the first time in M. wollei. Sequence analysis of PST biosynthetic gene cluster (sxt) genes indicated potential base variations, gene rearrangements, insertions, and deletions in the strain CHAB5998. Also, sxt gene has a longer evolutionary history in M. wollei than that in cyanobacteria from Nostocales. Multiple recombination breakpoints detected in sxt genes and the inconsistency in the topology of the phylogenetic trees between sxt and 16S rDNA suggested that multiple horizontal gene transfers (HGT) have occurred. Overall, the present study marks the first documented occurrence of PST-producing M. wollei outside of North America and identifies it as the first toxic freshwater benthic cyanobacterium in China. This revelation implies that benthic cyanobacteria may pose a higher environmental risk in China than previously acknowledged.