Algae grown in wastewater treatment lagoons are a potentially important substrate for biofuel production. The feasibility of using upflow anaerobic sludge blanket (UASB) reactors in anaerobic digestion of algae to produce methane was investigated. A favorable carbon to nitrogen (C/N) weight ratio of 21/1 was determined in batch reactor experiments in which the ratio was adjusted by blending algal biomass with sodium acetate as a carbon source. This blend of algae and acetate was used in the feedstock applied to the UASB reactors. Duplicate, 34-L, UASB reactors initially received an organic loading rate (OLR) of 0.9 g chemical oxygen demand (COD)/L.d at a 7.2-day hydraulic retention time (HRT). The OLR was gradually increased to 5.4 g/L.d and the HRT was decreased to 5.5 days resulting in a methane production increase from 247 to 298 mL/g COD biodegraded. The COD removal efficiency was 80% with a biogas methane composition of 90%.