Green nanoparticle (NP) synthesis is a sustainable and economical method of producing metallic nanoparticles (NPs) for pharmaceutical, environmental, and therapeutic applications using biological sources. The ability of macro and microalgae to employ materials at the nanoscale has drawn much attention to the realm of phyconanotechnology, which combines nanotechnology and phycology. The synthesis of bioactive compounds like chlorophyll, phycobilins, phenolics, flavonoids, glucosides, tannins, and saponins can be achieved through algae-based green nanoparticle synthesis, which is considered a significant advantage. These substances have potential uses in nanomedicine as therapeutic agents to combat microbial illnesses. Metallic nanoparticles made from algae are a promising option to treat infections brought on by microbial pathogens resistant to antibiotics due to their antimicrobial activity. The importance of using microalgae to produce nanoparticles for a range of uses is emphasized in this chapter, such as sensors, drug delivery, and antioxidants. By utilizing their capacity for photosynthesis and the synthesis of bioactive chemicals, algae can serve as biofactories for the production of nanomaterials. This chapter will also discuss the drawbacks of phyconanoparticles despite their possible advantages, such as uneven yield, size and form variations, and difficulties in scaling up manufacturing processes.