Global environmental contamination with a complex mixture of xenobiotics has become a major environmental issue worldwide. Many xenobiotic compounds severely impact the environment due to their high toxicity, prolonged persistence, and limited biodegradability. Microbial-assisted degradation of xenobiotic compounds is considered to be the most effective and beneficial approach. Microorganisms have remarkable catabolic potential, with genes, enzymes, and degradation pathways implicated in the process of biodegradation. A number of microbes, including Alcaligenes, Cellulosimicrobium, Microbacterium, Micrococcus, Methanospirillum, Aeromonas, Sphingobium, Flavobacterium, Rhodococcus, Aspergillus, Penecillium, Trichoderma, Streptomyces, Rhodotorula, Candida, and Aureobasidium, have been isolated and characterized, and have shown exceptional biodegradation potential for a variety of xenobiotic contaminants from soil/water environments. Microorganisms potentially utilize xenobiotic contaminants as carbon or nitrogen sources to sustain their growth and metabolic activities. Diverse microbial populations survive in harsh contaminated environments, exhibiting a significant biodegradation potential to degrade and transform pollutants. However, the study of such microbial populations requires a more advanced and multifaceted approach. Currently, multiple advanced approaches, including metagenomics, proteomics, transcriptomics, and metabolomics, are successfully employed for the characterization of pollutant-degrading microorganisms, their metabolic machinery, novel proteins, and catabolic genes involved in the degradation process. These technologies are highly sophisticated, and efficient for obtaining information about the genetic diversity and community structures of microorganisms. Advanced molecular technologies used for the characterization of complex microbial communities give an in-depth understanding of their structural and functional aspects, and help to resolve issues related to the biodegradation potential of microorganisms. This review article discusses the biodegradation potential of microorganisms and provides insights into recent advances and omics approaches employed for the specific characterization of xenobiotic-degrading microorganisms from contaminated environments.