This study involves a process of phyco-remediation of dairy industry wastewater by algal strain Chlamydomonas polypyrenoideum. The results of selected algal strain indicated that dairy industry wastewater was good nutrient supplement for algal growth in comparable with BG-11 growth medium. Alga grown on dairy industry wastewater reduced the pollution load of nitrate (90%), nitrite (74%), phosphate (70%), chloride (61%), fluoride (58%), and ammonia (90%) on 10th day of its growth as compared to that of uninoculated wastewater. The lipid content of algal biomass grown on dairy wastewater on 10th day (1.6 g) and 15th day (1.2 g) of batch experiment was found to be higher than the lipid content of algal biomass grown in BG-11 growth medium on 10th day (1.27 g) and 15th day (1.0 g) of batch experiment. The results on FTIR analysis of the extracted bio-oil through transesterification reaction was comparable with bio-oil obtained from other sources. (c) 2013 Elsevier Ltd. All rights reserved.