Microalgae have increasingly gained research interest as a source of lipids for biodiesel production. The wet way processing of harvested microalgae was suggested and evaluated with respect to the possible environmental impacts and production costs. This study is focused on the three key steps of the suggested process: flocculation, water recycling, and extraction of lipids. Microalgae strains with high content of lipids were chosen for cultivation and subsequent treatment process. Ammonium hydroxide was tested as the flocculation agent and its efficiency was compared with chitosan. Determined optimal flocculation conditions for ammonium hydroxide enable the water recycling for the recurring microalgae growth, which was verified for the use of 30, 50, and 80% recycled water. For extraction of the wet microalgae hexane, hexane/ethanol and comparative chloroform/methanol systems were applied. The efficiency of hexane/ethanol extraction system was found as comparable with chloroform/methanol system and it seems to be promising owing to its low volatility and toxicity and mainly the low cost.