Energy is indispensable for bringing competence, resilience, and comfort for the ever-advancing human lifestyle. Therefore, to satisfy the growing energy requirement researchers are trying to delve in exploring sustainable and renewable energy sources that will contribute to the reduction of carbon footprint and ultimately help to check the issue of global warming caused by the increased emission of CO2, due to the excessive usage of non-renewable and exhaustive fossil fuels. Microalgae are having the potential which can be exploited to produce biofuels (substitute for fossil fuels) and other value-added compounds. Microalgae is a form of unicellular photoautotrophic microorganism which can attain higher rate of proliferation. Microalgae is having merits over other terrestrial crops and fossil fuels as they have higher productivity of oil per hectare of land. Various other advantages of microalgae include their tolerance in different types of environment because of their ubiquitous nature (in terms of pH, salinity, and temperature). Furthermore, they can be cultivated in nonarable land and wastewater which will resolve the food-fuel duel and problem of freshwater usage, therefore leading towards environmental sustainability. The main factors governing the growth and cultivation of microalgae are light, CO2/air, nutrients, process parameters (pH, temperature, growth medium etc) and most importantly the type of system used for cultivation. The systems usually employed for the cultivation of microalgae are open system (open ponds, raceway ponds, scrubbers), closed system also commonly known as photobioreactors (flat plate and tubular photobioreactors) and hybrid system in which separation of biomass growth and lipid accumulation is achieved in two stages. All the systems have some merits and demerits but photobioreactors are widely accepted and used because they are having an upper hand over open system because of the optimised control of the growth conditions, contamination evasion and efficient productivity of microalgal biomass. This review will provide an insight to different parameters which govern the growth of microalgae and various types of photobioreactors with their advantages and disadvantages. This study will help in the optimized selection of the photobioreactors for a particular species of microalgae because despite the continuous and intensive research going on the cultivation systems it is a challenge for the researchers to achieve a suitable and economically viable system.