Innovative research and diagnostic techniques for biological testing have advanced during recent years because of the development of semiconductor nanocrystals. Although these commercially available, fluorescent nanocrystals have a protective organic coating, the inner core contains cadmium and selenium. Because these metals have the potential for detrimental environmental effects, concerns have been raised over our lack of understanding about the environmental fate of these products. U.S. Environmental Protection Agency test protocol and fluorescence microscopy were used to determine the fate and effect of quantum dots (QDs; Qdot 545 ITK Carboxyl Quantum Dots [Fisher Scientific, Fisher part Q21391MP; Invitrogen Molecular Probes, Eugene, OR, USA]) using standard aquatic test organisms. No lethality was measured following 48-h exposure of Ceriodaphnia dubia to QD suspensions as high as 110 ppb, but the 96-h median lethal concentration to Pseudokirchneriella subcapitata was measured at 37.1 ppb. Transfer of QDs from dosed algae to C. dubia was verified with fluorescence microscopy. These results indicate that coatings present on nanocrystals provide protection from metal toxicity during laboratory exposures but that the transfer of core metals from intact nanocrystals may occur at levels well above toxic threshold values, indicating the potential exposure of higher trophic levels. Studies regarding the fate and effects of nanoparticles can be incorporated into models for predictive toxicology of these emerging contaminants.