Microalgae are considered the most promising source of renewable fuels, high-value bio-products and nutraceuticals. Potentially, microalgae can satisfy many global demands, but in large-scale cultivation the average productivity of most industrial strains is lower than maximal theoretical estimations, mainly due to sub-optimal growth conditions. Although microalgae have developed complex strategies to cope with environmental stresses, cultivation in outdoor photobioreactors is limited to few species and it is not yet sufficiently remunerative. Indeed, most microalgal species are very sensitive to environmental conditions, and changes in solar irradiation, temperature, and medium composition can drastically decrease biomass yield. Developing new strategies for improving algal tolerance to stress conditions is thus greatly desirable. One of the first responses that occur in both higher plants and microorganisms following the exposure to abiotic stress conditions, is an increased synthesis and accumulation of the amino acid proline. While the role of proline accumulation in stress adaptation is well-recognized in higher plants, in microalgae the implication of proline in stress tolerance still awaits full elucidation. In this review we summarize available data on proline metabolism under environmental stress in eukaryotic microalgae. Possible implications toward optimization of algal growth for biotechnological purposes are also discussed.