The Arabian Gulf is considered a naturally stressed environment due to extremes of salinity and summer temperatures, and the Salwa Bay area is commonly considered to be the most hypersaline extension of this gulf. This study documents foraminiferal diversity, abundance and incidences of test deformities in Salwa Bay, near the Saudi Arabia−Qatar Border. The total time-averaged (live + dead) benthic foraminiferal assemblage was dominated by porcelaneous taxa (85%). The three most abundant species were Peneroplis pertusus (24%), P. planatus (15%), and Coscinospira hemprichii (9%), accounting for nearly half of the total assemblage. Other common taxa included Elphidium spp. (14%), Ammonia spp. (10%), and Quinqueloculina sp. (4%). About a quarter of the specimens picked were living (rose Bengal stained) at the time of collection, and 43% of the tests of the most common taxa were mildly to severely deformed. Types of deformities included fusion of two adults or double tests, protuberances on the spiral side, abnormal chamber arrangement, abnormal shape of the proloculus, dents, re-positioning of the aperture, and modification of the coiling plane. Two genera accounted for three quarters of the observed test deformities: Peneroplis (58%) and Coscinospira (17%). The combination of elevated temperatures, high salinities, and the ecology of the taxa encountered is likely responsible for the abundance, relatively low diversity, and high incidence of deformities in foraminiferal tests from Salwa Bay. We conclude that the percentage of test abnormalities is not a useful environmental proxy for pollution in such naturally stressed environments where high incidences of test deformities commonly occur.