Abstract: Anaerobic digestion is a widely used biotechnology for converting food, agricultural, and other organic wastes into biogas energy but produces nutrient-rich liquid effluent (digestate) that often requires costly disposal. Using digestate and similar wastewaters to produces microalgae for biodiesel or biochemical production can provide many economic and environmental benefits by offsetting fossil fuels. However, two aspects of microalgal production severely hinder the sustainability of the technique especially in arid regions: high energy use associated with the harvest of small microalgal cells and large volumes of water required to reduce concentrations of inhibitory compounds such as ammonia. We have compared the nutrient removal and pelletization potential of an easily harvested biofilm of robust and protective fungi evolved to high ammonia environments (ammonia fungi) with less resilient oleaginous microalgae for high strength wastewater treatment and biodiesel production.