​​Researchers have intensely examined links between biodiversity and ecosystem function, yet general principles remain elusive. Advances in trait-based ecology (TBE), however, provide a novel approach to address this important question. Here, we employ TBE to test how algal diversity impacts ecosystem function, specifically algal productivity, a timely question as algae are displacing corals on reefs globally. Using five macroalgal species with diverse functional traits we created six experimental treatments—five monospecific and one including all five species, each with 8 replicates. We quantified 12 traits related to productivity or productivity trade-offs (seven direct, five ratios) over a period of 14 days, measuring productivity as change in biomass. Trait data ordination plots revealed that each species occupied unique and relatively small areas of trait space grown in monoculture compared to when part of a diverse community. Moreover, five of 12 traits (volume, surface area, wet and dry weight, and toughness) increased linearly related to productivity, with more diverse communities being more productive than monocultures. Combined, results show that increased biodiversity increases an ecosystem function—productivity—and highlights the power of TBE for exploring basic ecological questions in coral reef ecosystems, providing insights into algal community dynamics that could help shape coral reef conservation.