To date, the algal biofuel industry has focused on the cultivation of monocultures of highly productive algal strains, but scaling up production remains challenging. However, algal monocultures are difficult to maintain because they are easily contaminated by wild algal strains, grazers, and pathogens. In contrast, theory suggests that polycultures (multispecies assemblages) can promote both ecosystem stability and productivity. A greater understanding of species interactions and how communities change with time will need to be developed before polycultures can be successfully applied to large-scale algal production efforts. Here we review the agricultural and ecological literature to explore opportunities for increased annual biomass production through the use of algal polycultures. We discuss case studies where algal polycultures have been successfully maintained for industries other than the biofuel industry, as well as the few studies that have compared biomass production of algal polycultures to that of monocultures. Assemblages that include species with complementary traits are of particular promise. These assemblages have the potential not only to increase crop productivity and stability, but they may also be capable of utilizing natural resources (e.g. light, nutrients, water) more efficiently via tighter niche packing. Therefore, algal polycultures show promise for enhancing biomass productivity, enabling sustainable production and reducing overall production costs.