One of the common causes of water pollution is the presence of toxic dye-based effluents, which can pose a serious threat to the ecosystem and human health. The application of Saccharomyces cerevisiae (S. cerevisiae) for wastewater decolorization has been widely investigated due to their efficient removal and eco-friendly treatments. This review attempts to create an awareness of different forms and methods of using Saccharomyces cerevisiae (S. cerevisiae) for wastewater decolorization through a systematic approach. Overall, some suggestions on classification of dyes and related environmental/health problems, and treatment methods are discussed. Besides, the mechanisms of dye removal by S. cerevisiae including biosorption, bioaccumulation, and biodegradation and cell immobilization methods such as adsorption, covalent binding, encapsulation, entrapment, and self-aggregation are discussed. This review would help to inspire the exploration of more creative methods for applications and modification of S. cerevisiae and its further practical applications.