One of the key challenges of material science currently is the design of multifunctional “smart” materials combining features from both molecular and supramolecular levels. Pursuing the strategy of amplification and transduction of light-induced motion of small molecules (photoswitches) across increasing length scales to macroscopic level, a novel polymer composite based on shape-reconfigurable microparticles is designed. The composite represents soft elastic matrix filled with photoactive microparticles of liquid crystal (LC) polymer bearing azobenzene moieties. Illumination of the composite film with polarized light results in a dramatic deformation of the microparticles such that the initially spherical shape becomes elongated along the direction of light polarization. This shape-shifting of particles is fully reversible and can be achieved by annealing or exposure to nonpolarized light. It is shown that photodeformation of particles is accompanied by photo-orientation of LC molecules and both processes can be controlled independently. The practical relevance of such materials is pointed out by the possibility to control optical properties (birefringence and light scattering) and optomechanical feedback yielding a new class of photoactuators. Overall, the developed material containing microscopic polymer photoactuators demonstrates an effective way of transducing molecular operation towards macroscopic functionality and can be particularly useful for optics and soft-robotics.