Keeping in view the challenges concerning agro-ecosystem and environment, the recent developments in biotechnology offers a more reliable approach to address the food security for future generations and also resolve the complex environmental problems. Several unique features of cyanobacteria such as oxygenic photosynthesis, high biomass yield, growth on non-arable lands and a wide variety of water sources (contaminated and polluted waters), generation of useful by-products and bio-fuels, enhancing the soil fertility and reducing green house gas emissions, have collectively offered these bio-agents as the precious bio-resource for sustainable development. Cyanobacterial biomass is the effective bio-fertilizer source to improve soil physico-chemical characteristics such as water-holding capacity and mineral nutrient status of the degraded lands. The unique characteristics of cyanobacteria include their ubiquity presence, short generation time and capability to fix the atmospheric N2. Similar to other prokaryotic bacteria, the cyanobacteria are increasingly applied as bio-inoculants for improving soil fertility and environmental quality. Genetically engineered cyanobacteria have been devised with the novel genes for the production of a number of bio-fuels such as bio-diesel, bio-hydrogen, bio-methane, syngas and therefore, open new avenues for the generation of bio-fuels in the economically sustainable manner. This review is an effort to enlist the valuable information about the qualities of cyanobacteria and their potential role in solving the agricultural and environmental problems for the future welfare of the planet.