Surfactants, also known as surface-active agents, have emerged as an important class of compounds with a wide range of applications. However, the use of chemical-derived surfactants must be restricted due to their potential adverse impact on the ecosystem and the health of human and other living organisms. In the past few years, there has been a growing inclination towards natural-derived alternatives, particularly microbial surfactants, as substitutes for synthetic or chemical-based counterparts. Microbial biosurfactants are abundantly found in bacterial species, predominantly spp. and spp. The chemical structures of biosurfactants involve the complexation of lipids with carbohydrates (glycolipoproteins and glycolipids), peptides (lipopeptides), and phosphates (phospholipids). Lipopeptides, in particular, have been the subject of extensive research due to their versatile properties, including emulsifying, antimicrobial, anticancer, and anti-inflammatory properties. This review provides an update on research progress in the classification of surfactants. Furthermore, it explores various bacterial biosurfactants and their functionalities, along with their advantages over synthetic surfactants. Finally, the potential applications of these biosurfactants in many industries and insights into future research directions are discussed.