Algae such as diatoms and haptophytes have distinct photosynthetic pigments from plants, including a novel set of carotenoids. This includes a primary xanthophyll cycle comprised of diadinoxanthin and its de-epoxidation product diatoxanthin that enables the switch between light harvesting and non-photochemical quenching (NPQ)-mediated dissipation of light energy. The enzyme responsible for the reversal of this cycle was previously unknown. Here, we identified zeaxanthin epoxidase 3 (ZEP3) from Phaeodactylum tricornutum as the candidate diatoxanthin epoxidase. Knocking out the ZEP3 gene caused a loss of rapidly reversible NPQ following saturating light exposure. This correlated with the maintenance of high concentrations of diatoxanthin during recovery in low light. Xanthophyll cycling and NPQ relaxation were restored via complementation of the wild-type ZEP3 gene. The zep3 knockout strains showed reduced photosynthetic rates at higher light fluxes and reduced specific growth rate in variable light regimes, likely due to the mutant strains becoming locked in a light energy dissipation state. We were able to toggle the level of NPQ capacity in a time and dose dependent manner by placing the ZEP3 gene under the control of a β-estradiol inducible promoter. Identification of this gene provides a deeper understanding of the diversification of photosynthetic control in algae compared to plants and suggests a potential target to improve the productivity of industrial-scale cultures.