The disease olive peacock eye was evaluated in organic olive orchards in Palestine (Asira, Burquin, Qabatia and Sir). In each orchard, six trees were randomly chosen (three pruned and three unpruned). Severity was estimated at 20 d intervals by determining the percentage of infected leaves in the upper, mid and lower parts of the canopy of each tree. Proportions were estimated of symptomatic leaves, and those with asymptomatic infections using the NaOH test. In spring, inflorescence length was determined just before flowering (white stage). The proportions of fruit set were also calculated on small, labeled branches. Among the different sites/orchards tested, there were significant differences in the infection level, which were related to climatic conditions. Pruning reduced the susceptibility of the trees to the disease. The infections were much greater in the lower parts of the canopy. Peacock eye greatly reduced inflorescence length and fruit set. Venturia oleaginea severity was negatively correlated with inflorescence development and fruit set, due to defoliation caused by the pathogen. Based on effects on fruit set, the disease could severely reduce olive yields. This is the first report showing quantitative relationship between olive defoliation caused by peacock eye and reproductive activity.