Algae are mainly water plants dwelling on ponds, rivers, seas, lakes, oceans, ditches and other water bodies. Some species are also found on stones, the bark of trees, fences, etc generally in moist environment. They are photosynthetic organisms that have chlorophyll and can make their own food. Fungi do not have chlorophyll so these organisms cannot make their own food as algae do. These are decomposers that survive either consuming dead matter or eating off other organisms.

The green algae have an important bearing upon our lives both for good and for evil. In course of their food-making activity, they add oxygen to the water, thus, making more of this essential gas available for fish and other organisms, which form an important part of our food supply. They also serve as food for these creatures. The evil side is the green algae cause water pollution in tanks, lakes, ponds, and many more with import unpleasant odours and flavor.

While fungi have an assimilative or vegetative phase in which nutrients are taken up and mycelial growth in the substratum occurs. This plase is followed by reproductive phase in which the mycelium grows aerially and produces fruiting structure and reproductive cells or spores. Several trees and other seed plants have a remarkable relationship with certain fungi. The mycelium of these fungi invades the root of the plants, which assist to transport water and minerals from the soil to the roots of the plants.

Thus, the main differences between algae and fungi are discussed below

1. Algae possess chlorophyll while fungi do not possess chlorophyll.
2. Algae are autotrophs and can make their own food where as fungi are heterotropls and cannot prepare their own food they live as parasites.
3. Generally, algae cannot live in darkness as light is essential to make of their food while fungi can live in light and in darkness also.
4. The cell wall in algae is mainly composed of carbohydrate cellulose where as cell wall in majority of the fungi are composed of chitin.
5. The plant body of algae is unicellular or multicellular known as thallus where as fungi the thallus is called as mycelium.
6. The algae are usually green colored where as fungi are not green and generally colorless.
7. The reserve food material of algae is starch while that of fungi is glycogen.
8. Examples of algae are oedogonium, oscillatoria, chara, diatoms, polysiphonia, and many more while examples of fungi are mushrooms, pythium, rhizopus, phytopthora, and many more.