Sodium alginate is an effective biomaterial for tissue engineering applications. Non-purified alginate is contaminated with protein, lipopolysaccharide, DNA, and RNA, which could elicit adverse immunological reactions. We developed a purification protocol to generate biocompatible alginate based on (a) activated charcoal treatment, (b) use of hydrophobic membrane filtration (we used hydrophobic polyvinylidene difluoride membranes to remove organic contaminants), (c) dialysis, and finally (d) ethanol precipitation. Using this approach, we could omit pre-treatment with chloroform and significantly reduce the quantities of reagents used. Purification resulted in reduction of residual protein by 70% down to 0.315 mg/g, DNA by 62% down to 1.28 μg/g, and RNA by 61% down to less than 10 μg/g, respectively. Lipopolysaccharide levels were reduced by >90% to less than 125 EU/g. Purified alginate did not induce splenocyte proliferation in vitro. Three-dimensional scaffolds generated from purified alginate did not elicit a significant foreign body reaction, fibrotic overgrowth, or macrophage infiltration 4 weeks after implantation. This study describes a simplified and economical alginate purification method that results in alginate purity, which meets clinically useful criteria.