Derivation of biofuel from microalgae biomass has been widely researched in the past few decades. Microalgae is capable of producing 58,700  litres oil per hectare that can generate 121,104  litres biodiesel per hectare, which seemingly a promising transition over conventional fossil fuels. Nevertheless, economic sustainability of commercial scale production of microalgae biomass is still in shadows of doubt, especially the cultivation and harvesting process. Apparently, the microalgae cultivation system has evolved from traditional open pond to various modern photobioreactor (PBR) designs. However, with regards to tubular and flat panel PBRs as the most ubiquitous systems for biofuel production at commercial level, extensive discussion on reactor configurations and design betterment was presented in this review, along with precise technical comparison on cost and energy requirements for the cultivation systems. This review intended to serve as guideline for long term adoption of these well-established cultivation technologies in biofuel plants given the numerous economic benefits. Besides that, in attempt to lower the harvesting cost, potential use of various waste biomass as bioflocculants to recover microalgae biomass was introduced in this review. This article also deliberates direction on potential policy interventions to produce microalgae biofuel in a more sustainable and cost-effective manners in near future. •Microalgae-derived biofuel is the potential substitute over fossil fuel.•Cultivation and harvesting steps are the bottlenecks to produce microalgae biofuel.•Wise selection of cultivation technology ensures sustainable biofuel production.•Bioflocculants from waste biomass are cheap, non-toxic, easily extracted.•Suitable policy framework ensures successful microalgae biofuel commercialization.