Toxicity of sediment from waterways of Ho Chi Minh City (HCMC), Viet Nam, was assessed in aqueous and organic extracts using the organisms Daphnia magna and Vibrio fischeri. Sediment samples were taken along the main canals of HCMC and in the Saigon river. The results indicate a relatively high potential toxicity of the extracts, especially concerning the aqueous extracts. V. fischeri shows a higher sensitivity than D. magna for both types of extracts. Sediments from the canals in the urban areas, where the industrial and domestic activities are concentrated, indicate a higher potential toxicity than sediments from the river. Organic extracts of deep sediments (about 1.3 m) are less toxic than surface sediment. The toxicity of the organic sediment extracts was higher in 1999 than in 1996, except for one site, where dredging operations have been carried out since 1997. The dredging operations thus have a positive local effect on the sediment quality, but further consequences on water and sediment quality of HCMC canals and rivers still have to be evaluated.