The major argument for using cyanobacteria or eukaryote microalgae for biofuel production is the pos­sibility to directly couple photosynthesis with product formation. This strategy could have sustainable and economic advantages. The financial appeal is related to the production chain, with CO2 fixation directly produc­ing the desired fuel in a single organism. Thus, the bio­fuel is recovered at the production site, avoiding as a consequence the processing of photosynthetically pro­duced sugars in a second-stage microbial fermentation. This process also has great ecological and sustainability appeal since atmospheric CO2 is being recycled into fuels without using the conventional agriculture system, leaving arable land available for food crops. Neverthe­less, the inherently low value and high demand charac­teristics of fuels present a challenge for the development of biofuel production. The volume of fuel required to fulfill the needs of the transportation sector is massive, in contrast to their low market value, which must be at least as cheap as bottled water. The achievement of this goal requires the solution of major challenges in civil and mechanical engineering, chemistry, and biology.

In the biological arena, the main challenge is strain development. The ideal cyanobacterium for biofuel pro­duction would have a high quantum efficiency of photo­synthesis and well-defined carbon partitioning, where the CO2 fixed would be primarily directed to "house­keeping" metabolism and the targeted product. To achieve this goal, two main venues are being followed: high-throughput bioprospecting, which seeks naturally occurring species, enzymes and pathways adaptable for cultivation and economic exploitation, or the use of genetic engineering, where a model organism is geneti­cally modified to introduce and/or to enhance the pro­duction of a desired molecule. In this section the available tools are discussed as well as some paths toward the improvement of photosynthetic quantum efficiency.