Occurrences whereby cnidaria lose their symbiotic dinoflagellate microalgae (Symbiodinium spp.) are increasing in frequency and intensity. These so-called bleaching events are most often related to an increase in water temperature, which is thought to limit certain Symbiodinium phylotypes from effectively dissipating absorbed excitation energy that is otherwise used for photochemistry. Here, we examined photosynthetic characteristics and hydrogen peroxide (H2O2) production, a possible signal involved in bleaching, from two Symbiodinium types (a thermally “tolerant” A1 and “sensitive” B1) representative of cnidaria–Symbiodinium symbioses of reef-building Caribbean corals. Under steady-state growth at 26°C, a higher efficiency of PSII photochemistry, rate of electron turnover, and rate of O2 production were observed for type A1 than for B1. The two types responded very differently to a period of elevated temperature (32°C): type A1 increased light-driven O2 consumption but not the amount of H2O2 produced; in contrast, type B1 increased the amount of H2O2 produced without an increase in light-driven O2 consumption. Therefore, our results are consistent with previous suggestions that the thermal tolerance of Symbiodinium is related to adaptive constraints associated with photosynthesis and that sensitive phylotypes are more prone to H2O2 production. Understanding these adaptive differences in the genus Symbiodinium will be crucial if we are to interpret the response of symbiotic associations, including reef-building corals, to environmental change.