Sesquiterpenes are a large variety of terpene natural products, widely existing in plants, fungi, marine organisms, insects, and microbes. The value-added sesquiterpenes are extensively used in industries as food, drugs, fragrances and fuels. With increase of the market demands and the price of sesquiterpenes, biosynthesis of sesquiterpenes by microbial fermentation methods from renewable feedstocks acquires increasing attention. The synthetic biology provides robust tools of sesquiterpene production in microorganisms. This review presents a summary of sesquiterpene biosynthesis and metabolic engineering strategies on the host and pathway engineering for sesquiterpene production. The diversity, native producers, and the synthases of sesquiterpenes are presented. Advances in synthetic biology provide new strategies on creation of the desired hosts for sesquiterpene production. Especially, metabolic engineering strategies for production of sesquiterpenes such as amorphadiene, farnesene, bisabolene, and caryophyllene are emphasized in Escherichia coli, Saccharomyces cerevisiae, and some other microorganisms. Future perspectives on strain and process improvements for sesquiterpene production are also discussed.