BACKGROUND: The South West Pacific nation of Papua New Guinea has intense year round transmission of Plasmodium falciparum on the coast and in the low-lying inland areas. Local heterogeneity in the epidemiology of malaria suggests that parasites from multiple locations will need to be surveyed to define the population biology of P. falciparum in the region. This study describes the population genetics of P. falciparum in thirteen villages spread over four distinct catchment areas of Papua New Guinea. METHODS: Ten microsatellite loci were genotyped in 318 P. falciparum isolates from the parasite populations of two inland catchment areas, namely Wosera (number of villages (n) = 7) and Utu (n = 1) and; and two coastal catchments, Malala (n = 3) and Mugil (n = 3). Analysis of the resultant multilocus haplotypes was done at different spatial scales (2-336 km) to define the genetic diversity (allelic richness and expected heterozygosity), linkage disequilibrium and population structure throughout the study area. RESULTS: Although genetic diversity was high in all parasite populations, it was also variable with a lower allelic richness and expected heterozygosity for inland populations compared to those from the more accessible coast. This variability was not correlated with two proxy measures of transmission intensity, the infection prevalence and the proportion multiple infections. Random associations among the microsatellite loci were observed in all four catchments showing that a substantial degree of out-crossing occurs in the region. Moderate to very high levels of population structure were found but the amount of genetic differentiation (FST) did not correlate with geographic distance suggesting that parasite populations are fragmented. Population structure was also identified between villages within the Malala area, with the haplotypes of one parasite population clustering with the neighbouring catchment of Mugil. CONCLUSION: The observed population genetics of P. falciparum in this region is likely to be a consequence of the high transmission intensity combined with the isolation of human and vector populations, especially those located inland and migration of parasites via human movement into coastal populations. The variable genetic diversity and population structure of P. falciparum has important implications for malaria control strategies and warrants further fine scale sampling throughout Papua New Guinea.