Chlorella vulgaris accumulates lipid under nitrogen limitation, but at the expense of biomass productivity. Due to this tradeoff, improved lipid productivity may be compromised, despite higher lipid content. To determine the optimal degree of nitrogen limitation for lipid productivity, batch cultures of C. vulgaris were grown at different nitrate concentrations. The growth rate, lipid content, lipid productivity and biochemical and elemental composition of the cultures were monitored for 20 days. A starting nitrate concentration of 170 mg L-1 provided the optimal tradeoff between biomass and lipid production under the experimental conditions. Volumetric lipid yield (in milligram lipid per liter algal culture) was more than double that under nitrogen-replete conditions. Interpolation of the data indicated that the highest volumetric lipid concentration and lipid productivity would occur at nitrate concentrations of 305 and 241 mg L-1, respectively. There was a strong correlation between the nitrogen content of the cells and the pigment, protein and lipid content, as well as biomass and lipid productivity. Knowledge of the relationships between cell nitrogen content, growth, and cell composition assists in the prediction of the nitrogen regime required for optimal productivity in batch or continuous culture. In addition to enhancing lipid productivity, nitrogen limitation improves the lipid profile for biodiesel production and reduces the requirement for nitrogen fertilizers, resulting in cost and energy savings and a reduction in the environmental burden of the process.