Scarcity and non-renewable nature of petroleum based liquid fuels have made them an un-reliable source of energy. Excessive greenhouse gas emissions and the associated effects on global warming have become noteworthy environmental, economic and social threats. In this milieu, the development of renewable, carbon-neutral and sustainable alternative energy sources has become inevitable. Biofuels have been found a promising alternative and a driving force for modern world. Different feed-stocks have been evaluated for biofuels production to date but microalgae have been found the most attractive due to their higher growth productivity, higher lipid contents, non-competitive nature with human food and their ability to grow on non-arable land using brackish or waste water. However, there are a number of technological barriers that are still questioning the economic feasibility and competitiveness of such biofuels. On the other hand, there are also a number of trade opportunities if we pay attention to the use of integrated system following the bio-refinery concept. Bio-refinery concept reflects the production of value added by-products along with the biofuels, contributing to an overall escalation of the economic feasibility of the whole system. These types of systems may help to progress the competitiveness of biodiesel production using microalgae as a potential feedstock. This paper reviews the most recent and relevant information on such integrated systems. Several aspects related to the treatment of municipal and animal wastewater with simultaneous recovery of microalgae and the potential of biodiesel production are discussed. Bio-refinery concept also presenting new opportunities for the cost-effective production of biodiesel coupled with valuable non-fuel by-products.