Raw cellulose, or even agro-industrial waste, have been extensively used for environmental applications, namely industrial water decontamination, due to their effectiveness, availability, and low production cost. This was a response to the increasing societal demand for fresh water, which made the purification of wastewater one of the major research issue for both academic and industrial R&D communities. Cellulose has undergone various derivatization reactions in order to change the cellulose surface charge density, a prerequisite condition to delaminate fibers down to nanometric fibrils through a low-energy process, and to obtain products with various structures and properties able to undergo further processing. Selective oxidation of cellulose, one of the most important methods of chemical modification, turned out to be a multitask platform to obtain new high-performance, versatile, cellulose-based materials, with many other applications aside from the environmental ones: in biomedical engineering and healthcare, energy storage, barrier and sensing applications, food packaging, etc. Various methods of selective oxidation have been studied, but among these, (2,2,6,6-tetramethylpiperidin-1-yl)oxyl) (TEMPO)-mediated and periodate oxidation reactions have attracted more interest due to their enhanced regioselectivity, high yield and degree of substitution, mild conditions, and the possibility to further process the selectively oxidized cellulose into new materials with more complex formulations. This study systematically presents the main methods commonly used for the selective oxidation of cellulose and provides a survey of the most recent reports on the environmental applications of oxidized cellulose, such as the removal of heavy metals, dyes, and other organic pollutants from the wastewater.