Wastewater generated by the textile industry has been a major environmental concern for a long. Production of fiber involves various steps and uses a lot of chemicals, dyes, and water. Therefore, the effluent produced from the textile industry needs proper purification before discharging into the water body. The current review summarizes various physical and chemical methods like ion exchange, coagulation-flocculation, membrane separation, membrane distillation, oxidation, ozonation, etc., for wastewater treatment. Along with this, adsorption methods, the various adsorbents used to purify wastewater, and the mechanism involved in adsorption have also been discussed. The biological method utilizes various microbes (bacteria, fungi, algae, and yeast) as a whole and the enzymes (laccase and azoreductase) secreted by them for wastewater treatment, which have been considered more feasible than physical and chemical methods. The adsorption and biological methods are better than other techniques due to their ability to degrade diverse classes of dye, less accumulation of harmless sludge, and cost-effective and safer approach for the disposal of textile effluent. While physical and chemical methods are expensive and generate toxic sludge, which is difficult to decompose.