An Australian gall-inducing eulophid, Ophelimus eucalypti (Gahan) was first recorded on the foliage of Eucalyptus botryoides after it invaded New Zealand in 1987. It has spread throughout the eucalypt plantations in the North Island and in the northern parts of the South Island affecting several species of Eucalyptus in the section Transversaria (subgenus Symphyomyrtus). Because gall-inducing insects usually have extremely narrow host ranges, O. eucalypti that induces galls on E. saligna and E. botryoides is currently recognized as a biotype, O. eucalypti (Transversaria). Heavily galled leaves abscise from the plant. Repeated defoliation led to widespread die-back of susceptible eucalypt species in the 1990s. Female larvae of O. eucalypti induce circular, protruding galls on the leaves of E. botryoides and E. saligna, whereas the males induce pit galls on the same species. The biology of O. eucalypti females and the development of their galls are described. Adult female O. eucalypti antennate the leaf surface before inserting the ovipositor (otherwise concealed within the metasomal apex) into the young host leaf. The egg is inserted at approximately 45° and discharged between differentiating palisade cells. Callus-type cells surround the egg chamber, but cytologically specialized nutritive cells appear once the egg hatches and the larva begins to feed. The gall also differentiates a multi-layered sclerenchymatous tissue around the nutritive tissue. After feeding for many months, the larva pupates and the active nutritive tissue degenerates. The adult wasp emerges after cutting an exit hole through to the outside of the gall. Abscission of heavily galled leaves results in widespread defoliation and loss of growth and vigour in susceptible trees in New Zealand.