The green alga Chlamydomonas reinhardtii is an interesting organism for production of heterologous isoprenoid natural products through metabolic engineering as it can grow photosynthetically and represents a plant-like cell environment for synthase expression. Here, we investigated expression of the patchoulol synthase from Pogostemon cablin (Benth) (PcPS) to probe the production of sesquiterpenoids from different sub-cellular compartments of the algal cell. We observed that knock-down of squalene synthase (SQS) in the cytoplasm did not affect sesquiterpene production titers in the plastid, suggesting no backward movement of FPP from cytoplasmic pools. Fusion of PcPS with a farnesyl pyrophosphate synthase (FPPS) did not enhance patchoulol production in the cytoplasm but did in the plastid, as also reported elsewhere. Secondary transformations with cytoplasmic and chloroplast-localized PcPS constructs increased synthase titers and improved patchoulol yields from both compartments. In multi-parallel photobioreactor experiments with patchoulol extraction through two-phase solvent contact, different daily patchoulol production behaviors were observed based on subcellular localization of the PcPS and carbon source. Those with plastid localization of PcPS-FPPS exhibited continued production into later stages of cultivation, while cytoplasm-localized PcPS with SQS k.d. had the highest production rates in mid logarithmic phase with low productivity in later growth stages. Cultivations in high-density photobioreactors with nutrient-enriched medium generated 15 mg patchoulol/L culture from CO2, the highest yield reported from the alga to date. The results indicate that the algal cell has flexible pools of isoprenoid precursors in different subcellular compartments from which the biotechnologist can design an expression strategy tailored to carbon feeding regimes.