Carbon dioxide (CO2) sequestration by microalgae has received widespread attention. Growth and biomass quality using flue gas, combined with medium recycling, were evaluated in this study. Results indicated that Spirulina maxima FACHB 438 can use flue gas from biomass power plant as sole carbon source. The final biomass of 26.30, 22.10, and 23.95 g in fresh medium (FM), recycled medium (RM), and recycled medium with activated carbon treatment (RM + AC) was harvested in flat-plate photobioreactors with 10 L working volume after 5 cycles, respectively. The mean specific growth rate and CO2 fixation rate did not differ significantly (p < 0.05), illustrating good growth performance in the three treatments. Activated carbon enhanced growth in RM + AC by 8.4% compared with RM. The quality of biomass in either FM or RM satisfies the Chinese standard for food/feed additives. This manner of mass culture reduced the cost of nutrients by up to 42%. Therefore, combination of CO2 sequestration from biomass power plant and medium recycling is demonstrated to be a new way to enhance the cost-effective Spirulina production.