The development of affordable ceramic membranes is essential for reducing expenses and optimizing the treatment of oily wastewater. There is an urgent demand for membranes that are not only affordable and easy to operate but also stable and capable of managing high fluxes to address the increasing volumes of oily wastewater. The significant production demands associated with many commercially available ceramic membranes, primarily due to the use of specialised raw materials and intricate processing methods, limiting their suitability for many wastewater treatment applications. Consequently, there is a rising interest in creating innovative ceramic membranes using affordable materials and simpler production techniques. This study reviewed the oil–water ceramic membranes utilizing affordable natural ceramic materials aimed at improving membrane performance. It focused on reviewing the environmentally friendly and economically viable membranes derived from natural ceramic resources as an alternative to conventional synthetic membranes. These natural ceramic materials possess crucial properties like hydrophilicity and oleophobicity, which are vital for effective oil–water separation. The ceramic membranes were reviewed for their filtration performance and advantages. It was reported that these natural ceramic material-based membranes demonstrate superior separation efficiency, and strong mechanical stability, making them promising candidates for sustainable water treatment.