Microbial fuel cells (MFC) are an emerging technology for wastewater treatment that utilizes the metabolism of microorganisms to generate electricity from the organic matter present in water directly. The principle of MFC is the same as hydrogen fuel cell and has three main components (i.e., anode, cathode, and proton exchange membrane). The membrane separates the anode and cathode chambers and keeps the anaerobic and aerobic conditions in the two chambers, respectively. This review paper describes the state-of-the-art membrane materials particularly suited for MFC and discusses the recent development to obtain robust, sustainable, and cost-effective membranes. Nafion 117, Flemion, and Hyflon are the typical commercially available membranes used in MFC. Use of non-fluorinated polymeric membrane materials such as sulfonated silicon dioxide (S-SiO2) in sulfonated polystyrene ethylene butylene polystyrene (SSEBS), sulfonated polyether ether ketone (SPEEK) and graphene oxide sulfonated polyether ether ketone (GO/SPEEK) membranes showed promising output and proved to be an alternative material to Nafion 117. There are many challenges to selecting a suitable membrane for a scaled-up MFC system so that the technology become technically and economically viable.