The global population and demand for alternative energy sources have proliferated extensively due to extensive depletion of fossil fuels and non-renewable energyNon-renewable energy sources. BiofuelsBiofuels offers a promising alternative resource which are renewable and possess the ability to mitigate greenhouse gas emissions. Organic matter rich in nutrients including C, N, and P are optimized by wastewater treatment plants. Interestingly, wastewater treatment facilities can be transformed to generate biofuelsBiofuels through incorporation of technologies. Biofuel extraction from wastewater containing mixed pollutants includes a number of cutting-edge methods, microbial fermentation, anaerobic digestionAnaerobic digestion, and algae cultivation. In the absence of oxygen, anaerobic digestion breaks down organic waste via microbial activities, yielding biogasBiogas as a byproduct. Besides biogas production, organic substrates can be converted by microbial fermentation into ethanol and biodieselBiodiesel as an alternative energy and transportation applications. Approaches toward next generation biofuel solutions promote the cultivation of microalgaeMicroalgae coupled with wastewater treatment to remove lipids from mixed micropollutants to obtain potential extracts of biofuel which are further treated by biological aerated filters (BAF)Biological aerated filters (BAF). Wastewater purification provides optimal conditions for microalgal growth, which are extensively effective at converting light and nutrients into biomass. Algal biomass can be hydrothermally liquefied to produce biocrude directly, or by bio decomposition to remove lipids for synthesis and upgradation to biodieselBiodiesel. The absorption of more nutrients and carbon dioxide (CO2) allows improvement of overall treatment efficiency toward carbon footprinting and sustainability. More importantly, wastewater treatment strategy encourages resource conservation, lowers environmental risk, and supports circular bioeconomy. The present chapter provides insights into the utilization of microalgaeMicroalgae for wastewater treatment and sustainable biofuel production.