Diversity of marine angiosperm species (seagrasses) at Kadolkele in Meegamnwa (Negombo) estuary was studied with a view to understanding the effect of substrate characteristics on diversity. Seagrass samples were obtained along three line transects, laid perpendicular to the shoreline at 20 m intervals. Shannon-Wiener index was used to determine the species diversity of seagrasses in the study site at Kadolkele that was divided into three strata, demarcated by the distance, i.e. 0-10 m. 10-20 m and 20-30 m from the shoreline. Comparison of Shannon-Wiener index values indicated that the diversity' of first stratum close to the shoreline was sienificantlv different * C / m' from that of the other two among which no significant difference was found to occur. Substrate pH, soil electrical conductivity, organic mater content and particle size distribution were measured from the substrate samples taken from each stratum. No statistically significant difference was observed with pH (3.92-6.82) and particle size distribution among the three strata. Soil electrical conductivity and organic matter content of stratum 3 however, was significantly different (p< 0.05) from the other two strata. Kadolkele seagrass bed consisted of two species and Halodule pinifolia (5822 shoots nD) dominated over Halophila oval is (1030 shoots nf2). The area adjacent (0-3 m) to thejnangroves at the shoreline was devoid of seagrasses ancff ovalis was absent in stratum 1, indicating that substrate characteristics have a marginal effect on the species richness of the seagrasses. Although species richness was similar in the other two strata, higher (Shannon) evenness (0.231), despite the relatively low abundance in stratum 2, contributes to its higher species diversity. Present study therefore documents the subtle habitat partitioning of co-existing marine angiosperm species in a limited area in Meegamuwa estuary.