This common fungus disease occurs on several grass types but is most severe on bermudagrass. It attacks neglected turf or areas that are under moisture or nutritional stress caused by a lack of nitrogen.
Warm, humid weather and cool nights with heavy dew promote the disease. It kills the grass in small spots 2 to 3 inches in diameter. The spots may grow together into large areas. They appear first as small, circular, straw-colored spots of blighted turfgrass about the size of a silver dollar. Individual leaves develop lesions that have a bleached, straw-colored appearance, bounded by a tan to reddish-brown margin. A white, cotton-like fungal mycelium growth may be seen in early morning when dew is present.
Pieces of diseased plants are spread by mowers, sweepers, and other lawn equipment.
For more information on this turf disease please follow this link to University of Arkansas Turf Website.
http://turf.uark.edu/publications/factsheets/Dollar%20Spot%20of%20Turfgrass%20in%20the%20Homelawn%20FSA-7541.pdf