Climate change is increasing the frequency of marine heatwaves around the world, causing widespread degradation of coral reefs. Endolithic microalgae inhabiting the coral skeleton have been highlighted as potentially important mediators of the consequences of heatwaves on coral reefs. These microalgae often bloom during heat stress due to greater light availability, theoretically delaying coral starvation by providing photoassimilates. However, these microalgae also dissolve coral skeletons at an accelerated rate during marine heatwaves, affecting the structural complexity of the reef. Despite their ecological role, no studies have examined endolithic algal blooms during a natural bleaching event. We quantified blooms of endolithic microalgae in the skeletons of lagoon corals bleaching on Heron Island in the austral summer of 2020. At the peak of heat stress, 20–30% of bleached corals across 9 genera at 3 sites had blooms. They were predominantly seen in branching Acropora spp. (37.8, 65.7 and 66.7% at three sites), which are primary reef builders at Heron Island. At the end of the bleaching event, the overall prevalence varied between 5 and 42%, and nearly all blooms were observed in acroporids. The relative high frequency of these blooms highlights the ongoing need to understand the role of these microbes during coral bleaching events.