The paleo-depositional environment of inner Prydz Bay, East Antarctica, has been reconstructed for the past 21,320 14C yr B.P., using diatom assemblages and sediment facies from a short, 352-cm-long gravity core. Between 21,320 and 11,650 14C yr B.P., compact tillite and diamicton are present in the core, and diatom frustules are rare to absent. These data suggest that an ice sheet grounded over the site during the last glacial maximum. Following glacial retreat, siliceous muddy ooze was deposited, from 11,650 to 2600 14C yr B.P., in an open marine setting. During this stage, diatom frustules are abundant and well preserved, and Thalassiosira antarctica resting spores and Fragilariopsis curta dominate the assemblage. This assemblage suggests open marine deposition in an environment where the spatial and temporal distribution of sea ice is less than today. Since 2600 14C yr B.P., sea-ice and ice-edge diatom species have become more abundant, and neoglacial cooling is inferred. The assemblage is similar to that forming currently in Prydz Bay, where sea ice is absent (<10% cover) for 2–3 months of the year and permanent ice edge and/or multiyear sea ice remains in close proximity to the site.