A cost-efficient process devoid of several washing steps was developed, which is related to direct cultivation following the decomposition of the sterilizer. Peracetic acid (PAA) is known to be an efficient antimicrobial agent due to its high oxidizing potential. Sterilization by 2 mM PAA demands at least 1 h incubation time for an effective disinfection. Direct degradation of PAA was demonstrated by utilizing components in conventional algal medium. Consequently, ferric ion and pH buffer (HEPES) showed a synergetic effect for the decomposition of PAA within 6 h. On the contrary, NaNO3, one of the main components in algal media, inhibits the decomposition of PAA. The improved growth of Chlorella vulgaris and Synechocystis PCC6803 was observed in the prepared BG11 by decomposition of PAA. This process involving sterilization and decomposition of PAA should help cost-efficient management of photobioreactors in a large scale for the production of value-added products and biofuels from microalgal biomass.