The photoalignment of alternate layer-by-layer (LBL) deposited water-soluble azobenzene dye, direct red 80 (DR80), and polycations have been investigated. The ultrathin films were probed by polarized irradiation, UV-vis spectroscopy, and angle-dependent optical retardation measurements using a hybrid liquid crystal (LC) cell. Dye aggregates within layers were found to reorient anisotropically with polarized irradiated visible light. The selective photoisomerization process primarily enhances the E-isomer, giving high dichroism with the long axes of the azobenzene dye oriented perpendicular to the polarization vector of irradiated light (actinic light). The degree of photoalignment was dependent on the number of adsorbed layers, aggregation behavior, and type of polycation pairs in contrast to spin-coated or Langmuir-Blodgett (LB) films. Atomic force microscopy (AFM) before and after photoisomerization showed lateral expansion of the morphological features consistent with greater anisotropic ordering. These results correlated with the in-plane azimuthal LC photoalignment behavior in hybrid LC cells. Interesting trends were observed, including thickness-dependent photoalignment behavior, different irradiation stabilities, phase shift, and read-write capabilities as photoactive ultrathin films.