Abstract: Docosahexaenoic acid (DHA), mainly derived from fish oil and algae oil, is an essential polyunsaturated fatty acid of the omega-3 family. Algal oil, compared with fish oil, is preferred for its higher purity of DHA and also safety. Therefore, algal oil is widely used in food and health care products. It interacts and synergies with the ingredients in food. This article reviews the physiological functions of DHA algal oil, including promoting brain and eye nerve development, enhancing immunity, anti-oxidation and anti-cancer effects. Besides, the article also summarizes the application of DHA algal oil in milk, yoghurt and milk powder, and explores the effects and mechanism of its interaction with food ingredients, like probiotics, prebiotics, phosphatidylserine and lecithin. This would provide a theoretical basis for wider and deeper use of DHA algal oil in food and health products industry.