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The veterinary parasiticide ivermectin was selected as a case study compound within the project ERAPharm (Environmental Risk Assessment of Pharmaceuticals). Based on experimental data generated within ERAPharm and additional literature data, an environmental risk assessment (ERA) was performed mainly according to international and European guidelines. For the environmental compartments surface water, sediment, and dung, a risk was indicated at all levels of the tiered assessment approach. Only for soil was no risk indicated after the lower tier assessment. However, the use of effects data from additional 2-species and multispecies studies resulted in a risk indication for collembolans. Although previously performed ERAs for ivermectin revealed no concern for the aquatic compartment, and transient effects on dung-insect populations were not considered as relevant, the present ERA clearly demonstrates unacceptable risks for all investigated environmental compartments and hence suggests the necessity of reassessing ivermectin-containing products. Based on this case study, several gaps in the existing guidelines for ERA of pharmaceuticals were shown and improvements have been suggested. The action limit at the start of the ERA, for example, is not protective for substances such as ivermectin when used on intensively reared animals. Furthermore, initial predicted environmental concentrations (PECs) of ivermectin in soil were estimated to be lower than refined PECs, indicating that the currently used tiered approach for exposure assessment is not appropriate for substances with potential for accumulation in soil. In addition, guidance is lacking for the assessment of effects at higher tiers of the ERA, e.g.;for field studies or a tiered effects assessment in the dung compartment. Integr Environ Assess Manag 2010;6567587. © 2010 SETAC.