To assess the quality of malaria diagnosis in 115 South African laboratories participating in the National Health Laboratory Service Parasitology External Quality Assessment Programme we reviewed the results from 7 surveys from January 2000 to August 2002. The mean percentage incorrect result rate was 13.8% (95% CI 11.3-16.9%), which is alarmingly high, with about 1 in 7 blood films being incorrectly interpreted. Most participants with incorrect blood film interpretations had acceptable Giemsa staining quality, indicating that there is less of a problem with staining technique than with blood film interpretation. Laboratories in provinces in which malaria is endemic did not necessarily perform better than those in non-endemic areas. The results clearly suggest that malaria laboratory diagnosis throughout South Africa needs strengthening by improving laboratory standardization and auditing, training, quality assurance and referral resources.