Ocean acidification poses a serious threat to a broad suite of calcifying organisms. Scleractinian corals and calcareous algae that occupy shallow, tropical waters are vulnerable to global changes in ocean chemistry because they already are subject to stressful and variable carbon dynamics at the local scale. For example, net heterotrophy increases carbon dioxide concentrations, and pH varies with diurnal fluctuations in photosynthesis and respiration. Few researchers, however, have investigated the possibility that carbon dioxide consumption during photosynthesis by non-calcifying photoautotrophs, such as seagrasses, can ameliorate deleterious effects of ocean acidification on sympatric calcareous algae. Naturally occurring variations in the density of seagrasses and associated calcareous algae provide an ecologically relevant test of the hypothesis that diel fluctuations in water chemistry driven by cycles of photosynthesis and respiration within seagrass beds create microenvironments that enhance macroalgal calcification. In Grape Tree Bay off Little Cayman Island BWI, we quantified net production and characterized calcification for thalli of the calcareous green alga Halimeda incrassata growing within beds of Thalassia testudinum with varying shoot densities. Results indicated that individual H. incrassata thalli were ~6% more calcified in dense seagrass beds. On an areal basis, however, far more calcium carbonate was produced by H. incrassata in areas where seagrasses were less dense due to higher rates of production. In addition, diel pH regimes in vegetated and unvegetated areas within the lagoon were not significantly different, suggesting a high degree of water exchange and mixing throughout the lagoon. These results suggest that, especially in well-mixed lagoons, carbonate production by calcareous algae may be more related to biotic interactions between seagrasses and calcareous algae than to seagrass-mediated changes in local water chemistry.