The soaring increase of flue gas emission had caused global warming, environmental pollution as well as climate change. Widespread concern on reduction of flue gas released from industrial plants had considered the microalgae as excellent biological materials for recycling the carbon dioxide directly emitted from exhaust industries. Microalgae also have the potential to be the valuable feedback for renewable energy production due to their high growth rate and abilities to sequester inorganic carbon through photosynthetic process. In this review article, we will illustrate important relative mechanisms in the metabolic processes of biofixation by microalgae and their recent experimental researches and advances of sequestration of carbon dioxide by microalgae on actual industrial and stimulate flue gases, novel photobioreactor cultivation systems as well as the perspectives and limitations of microalgal cultivation in further development.