Compared with phytochromes isolated from etiolated higher plant tissues and a number of lower plant species, the absorption spectrum of phytochrome isolated from the unicellular green alga Mesotaenium caldariorum is blue-shifted (Kidd, D. G., and Lagarias, J. C. (1990) J. Biol. Chem. 265, 7029-7035). The present studies were undertaken to determine whether this blue shift is due to a chromophore other than phytochromobilin or reflects a different protein environment for the phytochromobilin prosthetic group. Using reversed phase high performance liquid chromatography, we show that soluble protein extracts prepared from algal chloroplasts contain the enzyme activities for ferredoxin-dependent conversions of biliverdin IXalpha to (3Z)-phytochromobilin and (3Z)-phytochromobilin to (3Z)-phycocyanobilin. In vitro assembly of recombinant algal apophytochrome was undertaken with (3E)-phytochromobilin and (3E)-phycocyanobilin. The difference spectrum of the (3E)-phycocyanobilin adduct was indistinguishable from that of phytochrome isolated from dark-adapted algal cells, while the (3E)-phytochromobilin adduct displayed red-shifted absorption maxima relative to purified algal phytochrome. These studies indicate that phycocyanobilin is the immediate precursor of the green algal phytochrome chromophore and that phytochromobilin is an intermediate in its biosynthesis in Mesotaenium.