Hydrothermal liquefaction (HTL) of algae is a promising crude bio-oil (biocrude) production technology, which can convert wet algae into water-insoluble biocrude and other coproducts. In this work, algae HTL at 350°C and 20 min was conducted to obtain water-insoluble biocrude (B1), which was then hydrothermally upgraded at 450°C, 60 min, or with added H2 and/or homemade catalyst (i.e., Ni-Ru/CeO2 or Ni/CeO2) for the first time. The characteristics (e.g., yield, elemental component, energy recovery, and molecular and functional group compositions) of upgraded water-insoluble biocrude (B2) as well as light biocrude thereof were analyzed comprehensively. The results show that Ni-Ru/CeO2+H2 led to the highest yield and HHV (higher heating value), the best elemental compositions quality of B2, and the largest fraction and the best light of light biocrude in B2. Ni-Ru/CeO2+H2 had good catalytic desulfurization effect and could transform high-molecular-weight compounds into low-molecular-weight compounds in B1 upgrading. At the condition above, 46.2% of chemical energy in the initial algae could be recovered by B2, while average 54.9% of chemical energy in B2 was distributed in its light biocrude (hexane-soluble) portion. On the whole, Ni-Ru/CeO2+H2 can be considered as the optimal additive in all tested cases.