The global human population is predicted to increase around one and a half times by the year 2050. The increased population will require proportionate resources, and therefore, there will be an extensive surge in the demand for vital resources such as water, food, and energy. At present, most of the anthropogenic activities are being fed by the energy derived from the nonrenewable fossil fuels. However, these fossil fuels are depleting rapidly and exist on earth, only in limited quantities. Therefore, several countries are exploring other alternative, renewable resources of energy, which can potentially replace or reduce the dependence on fossil fuels. Among various alternatives are biofuels derived from various organic materials. The microalgae have emerged as a good source of fast-growing living system generating adequate organic materials for the production of biofuels. Microalgae have attracted the attention of many researchers due to their capacity to transform carbon dioxide into sugar while generating oxygen as a by-product, making them a sustainable energy source. Microalgae-mediated biological carbon dioxide fixation and carbon sequestration are, therefore, an effective, eco-friendly, and sustainable green technology. Microalgae have immense potential to be utilized replacing other conventional resources for biofuel production, as it grows rapidly, adapts to diverse environmental conditions, and possesses high photosynthetic efficiency. Besides this, microalgal biomass can be employed in various sectors, including food, cosmetics, and the production of bioplastics. The present chapter reviews the recent developments in the utilization of microalgae for the production of various types of biofuels in an eco-friendly and environmentally sustainable manner.