Background: The disease severity, ranging from being asymptomatic to having acute illness, and associated inflammatory responses has suggested that alterations in the gut microbiota may play a crucial role in the development of chronic disorders due to COVID-19 infection. This study describes gut microbiota dysbiosis in COVID-19 patients and its implications relating to the disease. Design: A cross sectional prospective study was performed on thirty RT-PCR-confirmed COVID-19 patients admitted to the All India Institute of Medical Sciences, Bhopal, India, between September 10 and 20, 2020. Ten healthy volunteers were recruited as the control group. IFN, TNF, and IL-21 profiling was conducted using plasma samples, and gut bacterial analysis was performed after obtaining the metagenomics data of stool samples. Results: Patients with a variable COVID-19 severity showed distinct gut microflora and peripheral interleukin-21 levels. A low Firmicute/Bacteroidetes ratio, caused by the depletion of the fibre-utilizing bacteria, F. prausnitzii, B. Plebius, and Prevotella, and an increase in Bacteroidetes has associated gut microbiota dysbiosis with COVID-19 disease severity. Conclusions: The loss of the functional attributes of signature commensals in the gut, due to dysbiosis, is a predisposing factor of COVID-19 pathophysiology.