Indonesia has a high potential in terms of seaweed species diversity. The Siboga Expedition (1899) recorded 782 species comprising 196 species of Chlorophyta, 134 species of Pheophyta and 452 species of Rhodophyta. Ethnobotany and ethnopharmacological studies have been carried out in several areas to determine the species commonly consumed as food and used for herbal medicine. In 2019, Tri Handayami updated the data with details of 201 species of Chlorophyta, 138 species of Pheophyta and 564 species of Rhodophyta to a total of 903 species. Despite this diversity, relatively few species have been cultivated and commercialized. These include several species of Carrageenophytes (Kappaphycus alvarezii, Eucheuma denticulatum, Kappaphycus striatus) and Agarophytes (Gracilaria changii, Gracilaria verucosa etc.). The harvest is both absorbed by the domestic industry and exported. Some species are harvested from nature but have not been cultivated, such as Sargassum sp. and Gelidium sp. and are used for a variety of purposes (food, feed and others), while Caulerpa sp. and Ulva sp. recently began to be cultivated. The processing industry is developing, and is now producing several carrageenan and agar products, and several special application products (e.g. with blending), both for domestic use and for export. Innovation is needed for sustainability and increasing the competitiveness of Indonesia’s seaweed industry by promoting the national programs supported by fostering a “national seaweed industry innovation and competitiveness ecosystem”, within the penta-helix (government, business, academia, civil society/community and the media) collaboration paradigm.