The growth in overall demand for plastic materials has given rise to the manufacture and utilization of plastic articles throughout the world. This has led to extreme waste production, negatively influencing terrestrial and marine life. Microplastics lead to the endangerment of health. Therefore, plastic decomposition is a difficult task. Chemical treatments, recycling, carbonizing, and landfills aren't ideal solutions for lowering plastic pollution. As a result of this, there is a need to research and identify alternatives that decompose much more rapidly like biodegradable plastics when compared to synthetic plastics. Biodegradable plastic can be produced by algae which contain polysaccharides. Microalgae process a huge amount of lipids, proteins, and carbohydrates which are significant substances in the formation of biopolymers. Owing to their high growth rate and volume, they can be cultivated in wastewater. This review examines the capability of microalgae to produce biodegradable plastic and its economic possibility. Each of the latest sustainable methods has been considered in this article: plastic biodegradation and bioplastic production using microalgae.