Photosynthetic microalgae harbor enormous potential as light-driven green-cell factories for sustainable bio-production of a range of natural and heterologous products such as isoprenoids. Their capacity for photosynthesis and rapid low-input growth with (sun)light and CO2 is coupled to a robust metabolic architecture structured toward the generation of isoprenoid pigments and compounds involved in light capture, electron transfer, and radical scavenging. Metabolic engineering approaches using eukaryotic green microalgae have previously been hampered mainly by low-levels of nuclear transgene expression. Here, we employed a strategy of optimized transgene design which couples codon optimization and synthetic intron spreading for the expression of heterologous plant enzymes from the algal nuclear genome. The diterpenoids casbene, taxadiene, and 13R(+) manoyl oxide were produced after expressing heterologous diterpene synthases and enzymes participating in the 2-C-methyl-d-erythritol 4-phosphate (MEP) pathway which were all targeted to the algal chloroplast. Additionally, a truncated and soluble plant microsomal cytochrome P450 monooxygenase was functionally expressed and able to hydroxylate 13R(+) manoyl oxide when directed into the chloroplasts. The heterologous diterpenoids were found to be excreted from the cells and accumulate in dodecane solvent-culture overlays. It was shown that the algal cell could tolerate significant metabolic pull towards diterpenoids without loss of native pigments. Using an algal strain producing 13R(+) manoyl oxide as a model, diterpenoid production was shown to be highest in photoautotrophic cultivations using CO2 as the sole carbon source and day:night illumination cycles. Up to 80 mg 13R(+) manoyl oxide per gram cell dry mass (CDM) could be produced from C. reinhardtii in a 7 day batch cultivation with a sustained maximal productivity of 22.5 mg gcdm−1 d−1 over 3 consecutive days. Collectively the results presented here suggest that green algal cells have remarkable potential for the heterologous production of non-native isoprenoids and support the use of these hosts for (sun)light driven bioproduction concepts.