Australia is the second largest producer of macadamia nuts worldwide, with more than 38,000 hectares dedicated to production primarily in southeast Queensland (SEQ) and Northern New South Wales (NNSW) regions. Phomopsis husk rot (PHR), primarily caused by Diaporthe australiana in Australia, has emerged as a significant disease affecting macadamia production. PHR has evolved from a sporadic occurrence to become prevalent in orchards, causing substantial premature fruit drop. The disease is characterised by soft black spots on the green pericarp that gradually merge, leading to fruit abortion during the immature stage, particularly in areas with wounded tissue. Given that Diaporthe species are known endophytes in macadamia and have been isolated from various plant tissues, we hypothesised that fruit endophytes serve as a primary source of inoculum. To investigate this hypothesis, we collected fruits of the highly susceptible cultivar HAES 344 from SEQ and NNSW farms at five phenological stages (match-head, pea size, half size, full immature, and full-size) and examined how wounding (wounded and non-wounded controls), temperature (15-35°C), and relative humidity (RH) influenced disease development from endophytic infections. Disease severity was assessed using a 0-5 rating scale after 7 days of incubation. PHR symptoms predominantly originated from natural infection points - the junction between the petiole and the pericarp, and natural openings on the pericarp that developed during incubation (99.7%) rather than from artificial wounds (0.3%). Disease severity peaked in full immature and full-size fruits at 25-30°C, while no symptoms developed at 15-20°C regardless of RH. Earlier developmental stages (match-head, pea size, half size) showed minimal to no disease development under all tested conditions. This study provides critical insights into PHR disease dynamics in macadamia, highlighting the significant role of temperature in disease progression and the most susceptible fruit stages. Understanding these factors is essential for developing effective control measures as the industry continues to expand under changing climatic conditions.