Chlorella vulgaris, a unicellular green microalga, has obtained significant attention due to its high protein content, abundance of bioactive compounds, and broad biotechnological potential. Used in nutraceuticals, pharmaceuticals, and functional foods, it is now gaining traction in cosmetics, biopharmaceuticals, and environmental applications. Recent advancements in fermentation technology, such as the development of high-density fermentation strategies, adaptive evolution of strains, and real-time monitoring systems, have greatly improved the efficiency, scalability, and sustainability of C. vulgaris production, enhancing bioavailability and product quality. This review explores developments in C. vulgaris fermentation, highlighting advancements in strain improvement through genetic engineering, metabolic optimization, mutagenesis, and adaptive evolution, alongside bioprocess engineering and the optimization of fermentation parameters. Key considerations include bioreactor design, downstream processing, and innovative monitoring technologies aimed at maximizing biomass yield and bioactive compound production. Emerging applications of fermented C. vulgaris across industries are also highlighted, along with future perspectives on scaling up production, addressing regulatory challenges, and ensuring biosafety. These insights provide a comprehensive outlook on the future of C. vulgaris fermentation in biotechnological applications.