Chlorination of seawater is a common practice to prevent biofouling on maritime structures. To enable control and reduce the environmental impacts of chlorine we measure the residual chlorine in wastewaters. In routine measurements of residual chlorine using N,N-diethyl-p-phenylenediamine (DPD), we found significant color development by DPD in non-chlorinated waters when large-sized phytoplankton appeared in high abundance. Through screening 27 microalgal isolates in laboratory culture, the diatom Coscinodiscus wailesii was shown to be the only species that causes the DPD color development in the procedure for total residual chlorine, although not for free residual chlorine, despite no chlorine additions to the culture medium. The result was also confirmed in field samples. Since two other species of genus Coscinodiscus did not show a similar result, this is considered to be highly species-specific. The color development was prevented by removing the C. wailesii cells using a 100 µm mesh cell strainer. Coscinodiscus wailesii did not react with 3,3′-dimethylbenzidine (o-tolidine), an alternative reagent to measure residual chlorine. We conclude that C. wailesii produces some materials which can oxidize DPD to produce the red color, and C. wailesii blooms in the field interfere with measurements of residual chlorine concentrations in natural and waste seawater.