Seedling survival and patch establishment is a major bottle-neck for eelgrass (Zostera marina) re-colonization as mortality rates among the young seedlings are high, even in areas where conditions should support survival. We here focus on the potential negative effects of drifting macroalgal mats on eelgrass seedling performance. The covering of eelgrass shoots by algae decreases the light availability and may hamper the diffusive movement of oxygen, inorganic carbon and nutrients to and from the shoots. Moreover, the high productivity of the algae can result in large diurnal oxygen variations within the mat and periods of anoxia in the lower parts can possibly be followed by release of sulphide from the sediments. We assessed the impact of algae mats on seedling performance and evaluated the relative importance of light attenuation and low oxygen concentrations for seedling growth and survival based on a 2-factorial laboratory experiment. Eelgrass seedlings were grown with three different heights and two different types of algae mats: Chaetomorpha linum and artificial macroalgae. The two types of mats were used to separate the physical and metabolic effects of algal presence. Concentrations of oxygen and sulphide and their diurnal variations in the mats were measured using microelectrodes. Seedling growth rates declined 99 % from controls to the high C. linum cover treatment and 55 % to the high imitation algae treatment. But due to high water flow rates anoxic conditions failed to develop and effects on seedling growth can thus be attributed to reduced light caused by shading of the algae. Generally, the seedlings are shown to be robust to short-term reductions in light availability, but further experiments are needed to elucidate the relative contributions of reduced light vs. anoxic conditions in ephemeral algae mediated eelgrass dieback events.