The majority of pulp and paper mills now biotreat their combined effluents using activated sludge. On the assumption that their wood-based effluents have negligible fixed N, and that activated-sludge microorganisms will not fix significant N, these mills routinely spend large amounts adding ammonia or urea to their aeration tanks (bioreactors) to permit normal biomass growth. N₂ fixation in seven Eastern Canadian pulp and paper mill effluent treatment systems was analyzed using acetylene reduction assays, quantitative nitrogenase (nifH) gene probing, and bacterial isolations. In situ N₂ fixation was undetectable in all seven bioreactors but was present in six associated primary clarifiers. One primary clarifier was studied in greater detail. Approximately 50% of all culturable cells in the clarifier contained nifH, of which >90% were Klebsiella strains. All primary-clarifier coliform bacteria growing on MacConkey agar were identified as klebsiellas, and all those probed contained nifH. In contrast, analysis of 48 random coliform isolates from other mill water system locations showed that only 24 (50%) possessed the nifH gene, and only 13 (27%) showed inducible N₂-fixing activity. Thus, all the pulp and paper mill primary clarifiers tested appeared to be sites of active N₂ fixation (0.87 to 4.90 mg of N liter¹ day¹) and a microbial community strongly biased toward this activity. This may also explain why coliform bacteria, especially klebsiellas, are indigenous in pulp and paper mill water systems.