Microbial oddities such as versatile pigments are gaining more attention in current research due to their widely perceived applications as natural food colorants, textiles, antimicrobial activities, and cytotoxic activities. This indicates that the future generation will depend on microbial pigments over synthetic colorants for sustainable livelihood. Although several reviews have detailed the comprehensive applications of microbial pigments extensively, knowledge on several aspects of pigmented microbes is apparently missing and not properly reviewed anywhere. Thus, this review has been made to provide overall knowledge on biodiversity, distribution, pathogenicity, and ecological and industrial applications of microbial pigments as well as their challenges and future directions for food, industrial, and biomedical applications. Meticulously, this compendious review treatise on the pigments from bacteria, fungi, yeasts, and microalgae includes reports from the 1970s to 2018. A total of 261 pigment compounds produced by about 500 different microbial species are included, and their bioactive nature is described.

The public’s demand for natural, eco-friendly, and safe pigments is significantly increasing in the current era. Natural pigments, especially fungal pigments, are receiving more attention and seem to be in high demand worldwide. The immense advantages of fungal pigments over other natural or synthetic pigments have opened new avenues in the market for a wide range of applications in different industries. In addition to coloring properties, other beneficial attributes of fungal pigments, such as antimicrobial, anticancer, antioxidant, and cytotoxic activity, have expanded their use in different sectors. This review deals with the study of fungal pigments and their applications and sheds light on future prospects and challenges in the field of fungal pigments. Furthermore, the possible application of fungal pigments in the textile industry is also addressed.