<p>Escalating depletion of the non-renewable resources and the crisis of global pollution creates a critical demand for advanced technologies and innovations in material sciences. In response, scientists are increasingly adopting the biological systems as inspiration for the development of sustainable and next generation materials. This review elucidates the concept of employing microalgae and cyanobacteria as living, photosynthetic substrates for the development of biomimetic systems and biomaterials. The organisms render a driving force for the engineered living materials emulating the natural biological mechanisms such as photosynthesis, carbon fixation, biomineralization, environmental sensing and resilience over hostile conditions. Besides, microalgae and cyanobacteria are crucial in the advancement of sustainable technology, reinforcing the generation of sustainable biomaterials for various applications including environmental biosensing, drug delivery systems and tissue oxygenation. Moreover, diverse biologically active frameworks, three-dimensional bioprinting, self-healing construction materials illustrates their potential of biomimicry versatility. Despite the barriers in the material stability and scalability persists, the integration of synthetic biology and artificial intelligence/machine learning provides adequate strategies to break through these constrains. By exploiting the intrinsic potential of these organisms, it is possible to replace the extractive material systems with the regenerative systems which ultimately accelerate the circular bioeconomy and redefine sustainability in biotechnology.</p> Graphical Abstract <p></p>