Photobacterium damselae subsp. damselae is an emerging pathogen which recently has been found with increasing frequency globally, in both wild and cultured fishes. The aim of this study was to characterize 16 isolates of Photobacterium damselae damselae from cultured fish in Australia and to investigate their pathogenicity to yellowtail kingfish. Considerable differences in phenotypic and genotypic traits occurred between bacterial isolates, indicating that different clonal lineages can co-exist in the same geographical area. Phylogenetic analysis did not support a monophyletic origin for P. damselae damselae, distinct from the other recognized subspecies, P. damselae piscicida. Of note was the significant relationship between the toxR genetic distance among isolates of P. damselae damselae and differences in their phenotypic profiles, enzyme activities and strength of haemolysis on blood agar plates. Isolates containing the pPHDD1 plasmid, and its associated haemolysin genes, showed a significantly larger haemolytic zone than did plasmid-free isolates containing only chromosome-I encoded virulence genes. An infection trial demonstrated that presence of the pPHDD1 plasmid is not essential for pathogenicity, although the plasmid does increase virulence towards Seriola lalandi. Understanding the intraspecific variability in virulence of Australian isolates of P. damselae damselae will assist the aquaculture industry, in particular the yellowtail kingfish industry, to develop more targeted treatment and control methods for infections with this pathogen.