AbstractMany marine organisms are exposed to decreasing O₂ levels due to warming-induced expansion of hypoxic zones and ocean deoxygenation (DeO₂). Nevertheless, effects of DeO₂ on phytoplankton have been neglected due to technical bottlenecks on examining O₂ effects on O₂-producing organisms. Here we show that lowered O₂ levels increased primary productivity of a coastal phytoplankton assemblage, and enhanced photosynthesis and growth in the coastal diatom Thalassiosira weissflogii. Mechanistically, reduced O₂ suppressed mitochondrial respiration and photorespiration of T. weissflogii, but increased the efficiency of their CO₂ concentrating mechanisms (CCMs), effective quantum yield and improved light use efficiency, which was apparent under both ambient and elevated CO₂ concentrations leading to ocean acidification (OA). While the elevated CO₂ treatment partially counteracted the effect of low O₂ in terms of CCMs activity, reduced levels of O₂ still strongly enhanced phytoplankton primary productivity. This implies that decreased availability of O₂ with progressive DeO₂ could boost re-oxygenation by diatom-dominated phytoplankton communities, especially in hypoxic areas, with potentially profound consequences for marine ecosystem services in coastal and pelagic oceans.