Cotton is the prime natural fiber with economic significance globally. Cotton farming and breeding have a long history in Pakistan. The development of high yielding upland cotton (Gossypium hirsutum) varieties gradually replaced the cultivation of diploid Gossypium species. Climate change along with emergence of new epidemic diseases caused yield loss in recent years. The biotic stress considerably reduced the performance and yield potential of cotton. Suitable breeding strategies are essential to generate useful genetic variations and to identify desired traits. Conventional breeding has remarkably increased cotton yield and fiber quality, which has cultivated the NIAB-78, S-12, MNH‐786, and FH‐Lalazar like cultivars. However, this phenotypic selection based breeding method has low efficiency to produce stress resilient cotton. The efficiency of traditional breeding has significantly improved by the marker assisted selection technology. Breakthroughs in molecular genetics, bioinformatics analysis, genetic engineering, and genome sequencing have opened new technique routes for cotton breeding. In addition, genetic improvement through quantitative trait loci, transcriptome, and CRISPR/Cas9 mediated genomic editing can provide suitable platform to improve the resistance to stresses induced by bollworms, cotton leaf curl virus, heat, drought, and salt. The approval of transgenic lines harboring triple gene Cry1Ac + Cry2A + GTG are critical for cotton crop. This review has critically discussed the progress and limitations of cotton breeding in Pakistan, and reviewed the utilization of novel genetic variations and selection tools for sustainable cotton production.