Microalgal biotechnology has gained prominence because of the ability of microalgae to produce value-added products including biodiesel through photosynthesis. However, carbon and nutrient source is often a limiting factor for microalgal growth leading to higher input costs for sufficient biomass production. Use of municipal wastewater as a low cost alternative to grow microalgae as well as to treat the same has been demonstrated in this study using mini raceway open ponds. Municipal wastewater was collected after primary treatment and microalgae indigenous in the wastewater were encouraged to grow in open raceways under optimum conditions. The mean removal efficiencies of TN, TP, COD-Mn, NH3-N after 6 days of retention time was 80.18%, 63.56%, 76.34%, and 96.74% respectively. The 18S rRNA gene analysis of the community revealed the presence of Chlorella vulgaris and Scenedesmus obliquus as the dominant microalgae. In addition, 16S rRNA gene analysis demonstrated that Rhodobacter, Luteimonas, Porphyrobacter, Agrobacterium, and Thauera were present along with the microalgae. From these results, it is concluded that microalgae could be used to effectively treat municipal wastewater without aerobic treatment, which incurs additional energy costs. In addition, municipal wastewater shall also serve as an excellent carbon and nitrogen source for microalgal growth. Moreover, the microalgal biomass shall be utilized for commercial purposes.