This invention relates to a new process for making fatty acids directly from a feedstock consisting of phytoplankton in water without the need to a) thermally separate, dewater and dry the phytoplankton, and b) extract the immobilized lipids.Our method is much less expensive than the current practice of making fatty acids from phytoplankton, because we bypass the costly and energy intensive operations associated with a) dewatering and drying the biomass, and b) extracting the immobilized lipids. As such, this invention greatly enhances the economic viability of making biofuels and bioproducts from phytoplankton.