The steady increase in use of ZnO nanoparticles (NPs) based consumer products possess high risk towards aquatic flora and fauna. Understanding the toxicity mechanism of ZnO NPs at an early stage is essential to develop a proper scientific design in innovation process to confine the exposure of nanoparticles at safer levels. Being the primary producers of aquatic food chain, various algal species were used as model organisms in several toxicological studies. This chapter summarizes the aspects that include environmental release, behaviour, dissolution, particle size, morphology, irradiation, reactive oxygen species generation, penetration/internalization of ZnO NPs on various algal species. Dissolved Zn ion toxicity was the major toxicity mechanism exhibited by ZnO NPs towards most of the algal species tested. Additionally, photocatalytic activity of ZnO NPs under UV irradiation also significantly increased the toxicity. To conclude, knowledge gaps and future research needs on the usage, discharge and its eco-toxicological effects of ZnO NPs were addressed.