The fungus Schizoxylon albescens occurs both as lichen and as saprobe. Lichenized colonies grow on the bark of Populus tremula; saprotrophic morphs grow on dead Populus branches. We wanted to (1) test whether lichenized and saprotrophic S. albescens are genetically distinct, (2) investigate photobiont association and diversity, (3) investigate the interactions between fungi and algae that occur during co-cultivation and (4) test whether Schizoxylon shows algal selectivity during lichenization. Fungal and algal genetic diversity were investigated for three markers. Algae from lichenized thalli were isolated in axenic cultures, and isolate sequence diversity was compared with algae amplified directly from thallus fragments. Co-culture experiments of fungi and algae were performed to study the morphological interaction patterns. Two distinct phylogenetic units are revealed in S. albescens, which are interpreted as phenotypically cryptic species. The algae are related to Coccomyxa and Pseudococcomyxa, and form two distinct sister clades separating samples isolated in cultures from those amplified directly from thallus fragments, indicating that more easily cultured strains of algae are not necessarily major components of the lichens. Schizoxylon albescens interacts with isolated algal strains, similar to fungal–Coccomyxa symbioses in nature. As the system is maintained without difficulty in culture, it can potentially be an easily controlled lichen symbiosis study system under laboratory conditions.