Malassezia furfur, the fungus causing pityriasis versicolor, has been reported to be sensitive to terbinafine in vitro but although topical therapy is effective in the treatment of pityriasis versicolor, oral therapy is not. This phenomenon was investigated by determining the susceptibility to terbinafine of different M. furfur subgroups in vivo (during topical or oral application) and in vitro. All M. furfur subgroups were suppressed (approximately 10-fold) by topical terbinafine. Oral treatment resulted in no significant suppression of cutaneous M. furfur populations with the exception of a single subgroup (A), which was reduced to undetectable levels on the skin of eight of 10 patients receiving oral terbinafine. Isolates of subgroup A were also markedly more susceptible to terbinafine in laboratory tests. The importance of the recognition of distinct subgroups within the cutaneous lipophilic yeasts when evaluating their antifungal susceptibility and their role in disease is discussed.