Algae have important strategic significance in optimizing food supply systems, promoting carbon sink fishery development, and enhancing marine economic competitiveness owing to their efficient biosynthetic capability, rich nutritional value, and ecological regulatory role. This article analyzes the current development status and main challenges faced by China's algae industry from the perspective of the "All-Encompassing Approach to Food,” and propose pathways and countermeasures to promote high-quality development of industry. Currently, China's algal industry has demonstrated steady overall growth, developing into a large-scale, intensive production system. Significant progress have been made in developing superior germplasm, expanding cultivation scales, upgrading products, and growing markets. However, some challenges still persist, such as limited innovation in stress-resistant germplasm, inadequate disease prevention and control systems, low levels of mechanization and automation in cultivation, short industrial chains, limited scientific research investment, outdated deep processing technology, and underdeveloped quality and safety supervision systems. To develop and expand the algal industry, it is necessary to strengthen policy support, accelerate breakthroughs in core and key technologies, and promote coordinated industry chains, green and low-carbon transformation, brand building, and global market integration.