During the period from 1993 to 1994, we carried out the study on the effect of cultivating grass carp in the enclosure on the biodiversity in Baoan Lake. The paper reported species composition, density and seasonal variations of diversity indexes of planktonic algae and periphytic algae inside and outside of the enclosure. There were 95 common planktonic algae species belonging to 67 genera inside of the enclosure, and only 82 species belonging to 58 genera outside the enclosure; 39 species of periphytic algae from 30 genera inside and 62 species, belonging to 43 genera outside. The similarity coefficient of community structure of planktonic algae was 0.895 inside and outside (S = 0.895), and the periphytic algae was 0.671 (S = 0.671). The annual density of planktonic algae was 38.43 times 10-4 cntdot L-1 times 10-4-68.87 times 10-4ind cntdot L-1 and 33.84 times 10-4-108.85 times 10-4ind cntdot L-1 respectively inside and outside of the enclosure. The average annual value of periphytic algae were 1149.83 times 10-4 and 5200.40 times 10-4ind cntdot gB-M-1 respectively. The diversity index of planktonic algae was 4.081 and 3.417 inside and outside of the enclosure respectively and the periphytic algae 2.499 and 2.709. Cultivating grass carp in the enclosure is more beneficial in protecting biodiversity than directly putting them into the Lake.