With increased worldwide energy demand and carbon dioxide emissions from the use of fossil fuels, severe problems are being experienced in modern times. Energy is one of the most important resources for humankind, and its needs have been drastically increasing due to energy consumption, the rapid depletion of fossil fuels, and environmental crises. Therefore, it is important to identify and search for an alternative to fossil fuels that provides energy in a reliable, constant, and sustainable way that could use available energy sources efficiently for alternative renewable sources of fuel that are clean, non-toxic, and eco-friendly. In this way, there is a dire need to develop technologies for biofuel production with a focus on economic feasibility, sustainability, and renewability. Several technologies, such as biological and thermochemical approaches, are derived from abundant renewable biological sources, such as biomass and agricultural waste, using advanced conversion technologies for biofuel production. Biofuels are non-toxic, biodegradable, and recognized as an important sustainable greener energy source to conventional fossil fuels with lower carbon emissions, combat air pollution, empower rural communities, and increase economic growth and energy supply. The purpose of this review is to explain the basic aspects of biofuels and their sustainability criteria, with a particular focus on conversion technologies for biofuel production, challenges, and future perspectives.