Microalgae have become imperative for biological wastewater treatment. Its capability in biological purification of wastewaters from different origins while utilizing wastewater as the substrate for growth has manifest great potentials as a sustainable and economical wastewater treatment method. The wastewater grown microalgae have also been remarked in research to be a significant source of value-added bioproducts and biomaterial. This paper highlights the multifaceted roles of microalgae in wastewater treatment from the extent of microalgal bioremediation function to environmental amelioration with the involvement of microalgal biomass productivity and carbon dioxide fixation. Besides, the uptake mechanism of microalgae in wastewater treatment was discussed in detail with illustrations for a comprehensive understanding of the removal process of undesirable substances. The performance of different microalgae species in the uptake of various substances was studied and summarized in this review. The correlation of microalgal treatment efficacy with various algal strain types and the bioreactors harnessed for cultivation systems was also discussed. Studies on the alternatives to conventional wastewater treatment processes and the integration of microalgae with accordant wastewater treatment methods are presented. Current research on the biological and technical approaches for the modification of algae-based wastewater system and the maximization of biomass production is also reviewed and discussed. The last portion of the review is dedicated to the assertion of challenges and future perspectives on the development of microalgae-based wastewater treatment technology. This review serves as a useful and informative reference for readers regarding the multifaceted roles of microalgae in the application of wastewater biotreatment with detailed discussion on the uptake mechanism.