Buddenbrockia plumatellae, an enigmatic worm-like myxozoan, was observed as continuously writhing free and attached ‘worms' and as free mature spores in the coelom of the freshwater bryozoans Plumatella fungosa, Hyalinella punctata, and Fredericella sp. ‘Worm’ numbers could double every three days. ‘Worms' and spores could be expelled from colonies by external pressure. Some mature ‘worms' exited actively, entraining release of free spores, and gradually ceased movement outside the host. Bryozoans sealed off infected regions of the colony. Infected colonies grew slowly, produced no statoblasts, and eventually regressed and died. Transmission was not achieved and prevalence was low. Electron microscopy of ‘worms' revealed a single layer of mural cells on a fibrous basal lamina overlying four longitudinal muscle blocks and an inner sheet of two types of proliferating cells, an organization indicative of the bilaterian ancestry of the Myxozoa. Primary type A cells were attached directly by striated tubules to mural cells at positions between muscle blocks. Secondary type A cells had a secretory function. Type B cells underwent meiosis and subsequently developed to typical malacosporean myxozoan spores filling the internal cavity of the ‘worms’. External tubes were formed during capsulogenesis in ‘worms' from Fredericella sp. Tetracapsula bryozoides is synonymised with Buddenbrockia plumatellae and a new genus is proposed for Tetracapsula bryosalmonae.