We present a novel conducting polypyrrole-based composite material, obtained by polymerization of pyrrole in the presence of iron(III) chloride on a cellulose substrate derived from the environmentally polluting Cladophora sp. algae. The material, which was doped with chloride ions, was molded into paper sheets and characterized using scanning and transmission electron microscopy, N2 gas adsorption analysis, cyclic voltammetry, chronoamperometry and conductivity measurements at varying relative humidities. The specific surface area of the composite was found to be 57 m2/g and the fibrous structure of the Cladophora cellulose remained intact even after a 50 nm duck layer of polypyrrole had been coated on the cellulose fibers. The composite could be repeatedly used for electrochemically controlled extraction and desorption of chloride and an ion exchanging capacity of 370 C per g of composite was obtained as a result of the high surface area of the cellulose substrate. The influence of the oxidation and reduction potentials on the chloride ion exchange capacity and the nucleation of delocalized positive charges, forming conductive paths in the polypyrrole film, was also investigated. The creation of conductive paths during oxidation followed an effective medium rather than a percolative behavior, indicating that some conduction paths survive the polymer reduction steps. The present high surface area material should be well-suited for use in, e.g., electrochemically controlled ion exchange or separation devices, as well as sensors based on the fact that the material is compact, light, mechanically stable, and moldable into paper sheets.