Phosphorus (P) is an essential element of microalgae, which is either required for anabolism or for energy metabolism. When employing a nitrogen limitation strategy to trigger microalgal intracellular lipid accumulation, P supplementation was always simultaneously applied to compensate for the accompanied growth inhibition. This study identified that P exerts hormesis effects on microalgae. Slight excess of P (≤ 45 mg L−1) under nitrogen limitation condition stimulated the cell growth of Chlorella regularis and achieved a 10.2% biomass production increase. This also improved mitochondrial activity by 25.0% compared to control (P = 5.4 mg L−1). The lipid productivity reached 354.38 mg (L d)−1, which increased by 39.3% compared to control. Such an improvement was caused by the intracellularly stored polyphosphate energy pool. However, large excess of P (250 mg L−1) inhibited the cell growth by 38.8% and mitochondrial activity decreased by 71.3%. C. regularis cells showed obvious poisoning status, such as enlarged size, plasmolysis, deformation of cell walls, and disorganization of organelles. This is probably because the over-accumulated P protonated the amide-N and disrupted membrane permeability. These results provide new insight into the roles of P in microalgae lipid production: P does not always play a positive role under nitrogen limitation conditions.