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Abstract The Chengjiang biota, a Burgess Shale‐type Lagerstätte in eastern Yunnan, South China (Cambrian Series 2, Stage 3), provides valuable information regarding the origin and early evolution of metazoans, and complex marine ecosystems. Although the major animal phyla in the Chengjiang biota have been extensively studied, macroalgae have received comparatively little attention. Here, we establish new taxa Yunnanospirellus typica and Y . elegans , describe five genera and six species ( Tawuia sp., Morania fragmenta , Liulingjitaenia alloplecta , Longfengshania stipitata , Lo . spheria and Paralongfengshania sicyoides ) not previously reported in the Chengjiang biota, and elucidate the pith structure of Enteromophites intestinalis . With 13 genera and 17 species now recorded, macroalgae rank fourth in species‐level biodiversity in the Chengjiang biota (behind Euarthropoda, Porifera and Priapulida). Macroalgae account for 71.57% of total abundance, far more than all other animal phyla in the Chengjiang biota. Fuxianospira is the most dominant genus, accounting for 52.01% of all macroalgae specimens. Unattached (floating, planktonic or drifting) forms dominate (eight attached; nine unattached species). The high diversity of attached macroalgae indicates that the macroalgal communities adapted to the Proterozoic firm substrate (probably covered by microbial mats) persisted from the Ediacaran to the early Cambrian, providing compelling evidence for the existence of firm substrate during this time. Meanwhile, the blooming of unattached macroalgae in the Chengjiang biota suggests that other niches were also rich in macroalgae. Unattached macroalgae might have provided oxygen and energy to metazoans, eventually leading to ecological expansion in the upper and middle water column of the early Cambrian seas.