There has been significant recent interest in the commercial utilisation of algae based on their valuable chemical constituents many of which exhibit multiple bioactivities with applications in the food, cosmetic, agri- and horticultural sectors and in human health. Compounds of particular commercial interest include pigments, lipids and fatty acids, proteins, polysaccharides and phenolics which all display considerable diversity between and within taxa. The chemical composition of natural algal populations is further influenced by spatial and temporal changes in environmental parameters including light, temperature, nutrients and salinity, as well as biotic interactions. As reported bioactivities are closely linked to specific compounds it is important to understand, and be able to quantify, existing chemical diversity and variability. This review outlines the taxonomic, ecological and chemical diversity between, and within, different algal groups and the implications for commercial utilisation of algae from natural populations. The biochemical diversity and complexity of commercially important types of compounds and their environmental and developmental control are addressed. Such knowledge is likely to help achieve higher and more consistent levels of bioactivity in natural samples and may allow selective harvesting according to algal species and local environmental conditions for different groups of compounds. Copyright © 2011 Elsevier Inc. All rights reserved.