Hemoglobin (Hb) is one of the most common conserved molecules found in organisms belonging to all major kingdoms of life. Chironomid midge larvae are unique among the invertebrates being the only free-living group of organisms possessing extracellular hemoglobins (Hbs) in monomeric and dimeric forms floating in their hemolymph. Remarkable ability of individual species of chironomid midges to tolerate wide range of environmental stressors prevailing in their respective ecosystems has enabled chironomids to sustain as one of the most widely distributed insects in the world. Ability of different Chironomus spp to thrive under extreme hypoxic conditions as well as in the presence of chemical pollution made chironomid midges an efficient model system to assess the effect of environmental stress in different freshwater ecosystems. The modulation of Hb concentration has been found to be a function of different type of abiotic stressors and thus Hb of chironomid midges (Ch-Hb) has attracted the attention as a potential biomarker for environmental biomonitoring. Large body of literature on Ch-Hb accumulated mainly during sixties to eighties of twentieth century has enriched our understanding of its physiological, developmental and biochemical features. Empirical as well as in-silico studies carried out in recent years provided insights into many structure-function relationships of Ch-Hb. However, for the last few decades, majority of the studies were carried out to project and validate Ch-Hb as potential bioindicator for evaluating toxicants, chemical pollutants and environmental gradients of dissolved oxygen concentration. In this review, historical development of the subject has been compiled with notes on future implications of contemporary studies on Ch-Hb.