Renewable energies, such as biofuels from algae, are a promising approach to deviate from fossil fuels. Mass algae cultivation requires better control over algae culture including taking advantage of co-cultivation with growth and lipid-promoting microorganisms. Integrating co-cultures into algal biotechnology can be beneficial in achieving enhanced yields and reduced expenditures. This work uses the co-cultivation of an alga with bacteria to simultaneously increase biomass and lipid productivities in algal cultures. Growth and lipid-promoting microbial cell-free filtrates were used to test for possible effects of bacterial extracellular compounds. Our results show that both the presence of bacterial cell as well as cell-free filtrate from one particular strain of bacteria, Pseudomonas composti, promoted the increase in biomass yield and lipid within freshwater Characium sp. 46-4. These results indicate that unidentified extracellular compounds released by bacteria can affect the growth rate and lipid metabolism of algae.