The sustainability of the energy supply is crucial for achieving sustainable socio-economic development, considering its economic, environmental, and public health implications. Biofuel is a very effective substitute for petroleum-based fuels on a worldwide scale. Burning fossil fuels poses significant risks to the environment as well as to human health due to the emission of greenhouse gases. Bioethanol, biodiesel, biohydrogen, and biogas are the main biofuels that have made significant progress in the past few decades. Various countries, such as India, are enhancing their capacity to produce renewable energy. The primary impediments to the widespread implementation of biofuels on an industrial level are the constraints of time and cost. Furthermore, the methods employed to convert diverse feedstocks into the required product vary depending on the techniques and materials used. Nanoparticles (NPs) offer an effective answer to the existing issues in utilizing biomass due to their selectivity, energy efficiency, and shorter reaction time, which finally reduces the production costs. Recently, many strategies have been implemented to boost biofuel production, with the utilization of several types of nanoparticles, including metal, magnetic, and metal oxide. NPs are useful as biofuel additives because of their unique properties, such as their structure, durability, higher surface area to volume ratio, ability to catalyse reactions, and ability to be used again and again. Also, carbon nanofibres, carbon nanotubes, and nanosheets that look like nanoparticles have been shown to be useful and inexpensive catalysts for immobilizing enzymes, which speeds up the process of making biofuel. The present study provides a thorough and all-encompassing summary of the use of diverse nanomaterials in biofuel production.