CAH3 is the only carbonic anhydrase (CA) present in the thylakoid lumen of the green algae Chlamydomonas reinhardtii. The monomer of the enzyme has a molecular weight of ~29.5 kDa with high CA activity. Through its dehydration activity, CAH3 can be involved either in the carbon-concentrating mechanism supplying CO2 for RuBisCO in the pyrenoid or in supporting the maximal photosynthetic activity of photosystem II (PSII) by accelerating the removal of protons from the active center of the water-oxidizing complex. Both proposed roles are considered in this review, together with a description of the enzymatic parameters of native and recombinant CAH3, the crystal structure of the protein, and the possible use of lumenal CA as a tool for increasing biomass production in higher plants. The identified involvement of lumenal CAH3 in the function of PSII is still unique among green algae and higher plants and can be used to understand the mechanism(s) of the functional interconnection between PSII and the proposed CA(s) of the thylakoid lumen in other organisms.