Sustainable energy production represents one of the most formidable problems of the 21st century, and plant-based biofuels offer significant promise. We summarize the potential advantages of using pond-grown microalgae as feedstocks relative to conventional terrestrial biofuel crop production. We show how pond-based algal biofuel production, which requires significantly less land area than agricultural crop-based biofuel systems, can offer additional ecological benefits by reducing anthropogenic pollutant releases to the environment and by requiring much lower water subsidies. We also demonstrate how key principles drawn from the science of ecology can be used to design efficient pond-based microalgal systems for the production of biodiesel fuels.