In order to fulfil the Aquaculture Strategy employed by the New Zealand Government and achieve the goal of increasing industry revenue to $3billion by 2035, more mussel spat hatcheries must be developed to deliver reliable spat supplies. Hatcheries are expensive to operate, especially to produce microalgae for larval feed; therefore, finding the most efficient procedures for spat deliverance and algae production is of utmost importance. Diets high in Chaetoceros calcitrans supplemented with Tisochrysis lutea are conventionally fed to Perna canaliculus larvae and current production methods are not feasible in a commercial scale hatchery due to the high cost and labour of operating the systems. Therefore, the effect of microalgal diet on larval performance was investigated for two diets significantly reducing the C. calcitrans proportion compared to the conventional diet (control). Furthermore, batch crashes of microalgae are common and disrupt daily operations due to the sensitivity of larvae to changes in food availability or species compositions, which could result in significant setbacks for a hatchery. Therefore, it is necessary to investigate alternative production methods or substitute proportions of the species with an alternative microalgae species. A fourth diet completely substituting T. lutea with Diacronema lutheri was investigated to determine if the species could be interchanged in the case of a batch failure. Fatty acid analysis alongside indicators such as larval growth, umbo yield, pediveliger yield, spat yield, settlement success, ingestion rates and capture efficiency were investigated to determine larval performance. In contrast to previous studies suggesting that high levels of DHA and EPA are essential for larval growth and survival, there was no clear pattern as to how high DHA and EPA levels benefit larval performance in P. canaliculus. It was found that P. canaliculus larvae fed the lowest proportion of C. calcitrans supplemented with C. muelleri had the lowest EPA content across the larval period but performed the best, in contrast to larvae fed the most EPA rich- diet consisting of C. calcitrans and D. lutheri which performed the worst. Findings from this study imply that it is more beneficial to investigate precursor fatty acids or the sum of n-3 and n-6 fatty acids, opening opportunity for further research to better identify nutritional requirements of P. canaliculus larvae. In conclusion, a reduction in C. calcitrans did not adversely affect the growth or yield of larvae. In fact, the yields and settlement success were similar to that of the conventional microalgal diet. Therefore, diets with low C. calcitrans replaced by C. muelleri may be better suited for application to a commercial scale hatchery to reduce the strain placed on labour and logistics associated with C. calcitrans batch production. Furthermore, it was found that the use of D. lutheri as a complete replacement of T. lutea is not recommended due to the low larval performance associated with the diet. These findings enable resources and energy to be focussed elsewhere allowing the production of more mussels with lower resource inputs, reducing the environmental footprint of aquaculture operations.