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Exceptional microfossil preservation, whereby sub-cellular details of an organism are conserved, remains extremely rare in the Precambrian rock record. We here report the first occurrence of exceptional cellular preservation by the rare earth element (REE) phosphates monazite and xenotime. This occurs in ~1 billion-year-old lake sediments where REEs were likely concentrated by local erosion and drainage into a closed lacustrine basin. Monazite and xenotime preferentially occur inside planktonic cells where they preserve spheroidal masses of plasmolyzed cell contents, and occasionally also membranous fragments. They have not been observed associated with cell walls or sheaths, which are instead preserved by clay minerals or francolite. REE phosphates are interpreted to be the earliest minerals precipitated in these cells after death, with their loci controlled by the micro-scale availability of inorganic phosphate (Pi) and REEs, probably sourced from polyphosphate granules within the cells. The strong affinity of REEs for phosphate and the insolubility of these minerals once formed means that REE phosphates have the potential for rapid preservation of cellular morphology after death and durability in the rock record. Hence, authigenic REE phosphates provide a promising new target in the search for the preservation of intra-cellular components of fossilised microorganisms.