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Algae are photosynthetic organisms and can prepare their food. Fungi are eukaryotic heterotrophic organisms. Fungi cannot make their food and hence depend on other organisms for food.

Also, fungi feed on dead and decaying matter and consequently clean up from the environment.

Lichen is a composite organism. It includes algae or cyanobacteria and fungi, forming a mutualistic or symbiotic association between them. The dominant partner in a lichen is fungi, while algae are the photosynthetic partner.

The fungus provides the overall shape and structure of the lichen. Lichens are known as the best pollution indicators because they are sensitive to air pollution and do not grow in polluted areas.

Lichen algae depend on fungi for drawing benefits such as a suitable environment for their growth and protection from external threats such as predation. The hyphae of fungi allow for gas exchange.

Fungi capture moisture and water from airborne dust or rain. The algae get moisture from the fungus that the latter uptakes through the secretion of acids. They also get water and minerals retained by fungi required for photosynthesis by algae.

In lichen, fungi provide an anchor to algae and act as the dominant partner. Thus, both lichen algae and fungi offer benefits to each other during the symbiotic association.