Relative abundance data of diatom (Bacillariophyceae) species were generated for sediment core SKPC-01B from the Skalafjord, Faeroe Islands. The record shows distinct temporal changes in species composition. In the lowermost 65 cm of the 230 cm long core a species-rich freshwater diatom assemblage was found. Most of the taxa observed in this section are typical of oligotrophic to dystrophic lakes in northern Europe (Scandinavia, Iceland and Spitsbergen). Above this interval the diatom flora is dominated by marine taxa. The change from a freshwater to a marine flora is inferred to be caused by rising sea-level that took place about 7700–6400 years BP. Drastic changes in the diatom species composition within the transitional core section show that environmental change in the Skalafjord took place in several pulses. The first stage included strong inflow (possibly catastrophic) of marine waters. As a possible trigger of this phenomenon the tsunami released by the Storegga Slide is proposed. Before the final flooding by marine waters, freshwater conditions were re-established within the Skalafjord. These results have important implications for the interpretation of the palaeogeographical development of the Eysturoy area. Hence, it is suggested that the Storegga Slide led to inflow of marine waters at a distinctly lower water level in the area of the Skalafjord than proposed in recent publications and that the inundation of the threshold in the fjord happened after the tsunami.