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Abstract Algae and mercury (Hg) are ubiquitous in marine environments. In this study, we investigated the effects of a typical marine algae of diatom Skeletonema costatum on Hg methylation by an iron-reducing bacterium of Geobacter sulfurreducens (G. sulfurreducens) PCA. In the absence of Skeletonema costatum , the bacterial MeHg production rate maximized at 104.06 ± 11.7 ng L−1 h−1 with a high Hg level, while the highest methylation efficiency was achieved at a low Hg concentration. The existence of Skeletonema costatum greatly inhibited the capability of G. sulfurreducens PCA to methylate Hg. With the increase in algal biomass, there was a significant mitigation of MeHg formation and Hg0 release, leaving a considerable proportion of immobilized Hg2+ species (up to 47%) associated with algal cell materials. These results suggest that marine algae are crucial in determining the bioavailability of Hg contaminants and the methylating potential of G. sulfurreducens PCA. Highlights • Marine algae of Skeletonema costatum was insignificant in Hg methylation. • G. Sulfurreducens PCA was capable of bacterial methylation of Hg. • Bacterial methylation depended on initial Hg level and active algal biomass. • Bacterial methylation of Hg was inhibited by Skeletonema costatum. • Algal biomass was crucial in determining the distribution and transformation of Hg. [ABSTRACT FROM AUTHOR]