Arsenic content of cyanobacterial biomass, soil and water samples from arsenic-contaminated area of eastern India were estimated. It was found that arsenic content in cyanobacterial biomass (276.9 μg g-1) was more than soil (19.01 μg g-1) or water sample (244. 13 μg L-1). Shallow tube well water showed more arsenic (244.13 μg L-1) than deep tube well water (146.13 μg L-1). Arsenic resistant genera recorded from the contaminated area were Oscillatoria princeps, Oscillatoria limosa, Anabaena sp. and Phormidium laminosum. Among these, P. laminosum was isolated and exposed to different concentration of Arsenic in vitro (0.1-100 ppm) to study the toxicity level of arsenic. Modulation in stress enzymes and stress-related compounds were studied in relation to lipid peroxidase, catalase, super oxide dismutase (SOD), ascorbate peroxidase (APX), reduced glutathione and carotenoids in arsenic exposed biomass to understand the resistance mechanism of the genus both in laboratory condition as well as in natural condition. Arsenic content of cyanobacterial biomass from contaminated area was more (276.9 μg g-1) than laboratory exposed sample (37.17 μg g-1), indicating bioconcentration of arsenic in long-term-exposed natural biomass. Overall, more activity of catalase was recorded in cyanobacterial biomass of natural condition whereas SOD and APX were at higher level in laboratory culture. © 2010 Springer Science+Business Media B.V.