Transcription factor (TF)-based biosensors (TFBs) have received considerable attention in various fields due to their capability of converting biosignals, such as molecule concentrations, into analyzable signals, thereby bypassing the dependence on time-consuming and laborious detection techniques. Natural TFs are evolutionarily optimized to maintain microbial survival and metabolic balance rather than for laboratory scenarios. As a result, native TFBs often exhibit poor performance, such as low specificity, narrow dynamic range, and limited sensitivity, hindering their application in laboratory and industrial settings. This work analyzes four types of regulatory mechanisms underlying TFBs and outlines strategies for constructing efficient sensing systems. Recent advances in TFBs across various usage scenarios are reviewed with a particular focus on the challenges of commercialization. The systematic improvement of TFB performance by modifying the constituent elements is thoroughly discussed. Additionally, we propose future directions of TFBs for developing rapidresponsive biosensors and addressing the challenge of application isolation. Furthermore, we look to the potential of artificial intelligence (AI) technologies and various models for programming TFB genetic circuits. This review sheds light on technical suggestions and fundamental instructions for constructing and engineering TFBs to promote their broader applications in Industry 4.0, including smart biomanufacturing, environmental and food contaminants detection, and medical science.