Cephalodia are small gall-like structures found in some species of lichen

Lichen

Lichens are composite organisms consisting of a symbiotic organism composed of a fungus with a photosynthetic partner , usually either a green alga or cyanobacterium...

s that contain cyanobacterial symbionts

Symbiosis

Symbiosis is close and often long-term interaction between different biological species. In 1877 Bennett used the word symbiosis to describe the mutualistic relationship in lichens...

. Cephalodia can occur within the tissues of the lichen, or on its upper or lower surface. Lichens that have both green algal and cyanobacterial symbionts restrict the cyanobacteria to cephalodia. Lichens that have only cyanobacterial symbionts do not have cephalodia, instead the cyanobacteria are widely distributed throughout the lichen. Lichens with cephalodia can fix nitrogen

Nitrogen fixation

Nitrogen fixation is the natural process, either biological or abiotic, by which nitrogen in the atmosphere is converted into ammonia . This process is essential for life because fixed nitrogen is required to biosynthesize the basic building blocks of life, e.g., nucleotides for DNA and RNA and...

, and can be an important contributor of nitrogen to the ecosystem.