Global warming caused by CO2 emissions has been considered as one of the major challenges of this century. In an endeavor to control and reduce CO2 emissions, a series of Carbon dioxide Capture, Utilization, and Storage (CCUS) technologies have been developed specifically for the sequestration of CO2 from atmospheric air. Microalgae, as versatile and universal photosynthetic microorganisms, represent a promising avenue for biological CO2 sequestration. Nevertheless, further advancements are necessary to optimize microalgae-based carbon sequestration technology in terms of light reaction and dark reaction. This review discusses the current status of microalgae-based artificial CO2 sequestration technique, with a particular focus on the selection of CO2-resistant species, optimization of cultivation for CO2 sequestration, design of carbon concentration reactor, and the potential of synthetic biology to enhance CO2 solubility and biofixation efficiency. Furthermore, a discussion of Life cycle assessment and Techno-economic analysis regarding microalgae-based carbon capture was performed. The aim of this comprehensive review is to stimulate further research into microalgae-based CO2 sequestration, addressing challenges and opportunities for future development.