Net phosphorus removal from waste stabilisation pond (WSP) systems is governed by the rate of phosphorus incorporation into the sludge layer and the rate of phosphorus release from this sludge back to the overlying wastewater. Luxury uptake of phosphorus by microalgae has been shown to occur under WSP conditions in the laboratory; however, the significance of this mechanism and the fate of polyphosphate contained in the settled solids have not previously been investigated. In this work the analysis of sludge samples from three WSP showed that up to 71% of the total phosphorus in the sludge was in the form of polyphosphate. This indicates that polyphosphate accumulation could potentially be an important mechanism for phosphorus sequestration in WSP and challenges the common view that chemical precipitation is the predominant phosphorus removal mechanism in these systems. The release of phosphate from WSP sludge samples was monitored in the laboratory. The samples from two different pond systems had release rates in the order of 4.3 μgP/gTSS.d. However, the third sample which was collected during an algal bloom had a release rate of 12.4 μgP/gTSS.d. Phosphate release from fresh microalgal sludge grown under laboratory conditions was also studied and was shown to have a release rate of 160 μgP/gTSS.d. Analysis of polyphosphate during the experiments on laboratory grown microalgal sludge showed that polyphosphate was indeed degraded resulting in phosphate release. Interestingly, after the initial release phase phosphorus was assimilated by the biomass and some polyphosphate was reformed. It is likely that this is due to bacterial growth in the sludge.