We measured the mean fitness of populations of Chlamydomonas reinhardtii maintained in the laboratory as obligately sexual or asexual populations for about 100 sexual cycles and about 1000 asexual generations. Sexuality (random gamete fusion followed by meiosis) is expected to reduce mutational load and increase mean fitness by combining deleterious mutations from different lines of descent. We found no evidence for this process of mutation clearance: the mean fitness of sexual populations did not exceed that of asexual populations, whether measured through competition or in pure culture. We found instead that sexual progeny suffer an immediate loss in fitness, and that sexual lines maintain genetic variance for fitness. We suggest that sexual populations at equilibrium with selection in a benign environment may be mixtures of several or many epistatic genotypes with nearly equal fitness. Recombination between these genotypes reduces mean fitness and creates genetic variance for fitness. This may provide fuel for continued selection should the environment change.