This study investigates the potential of microalgae as a sustainable feedstock for biodiesel production, examining both the opportunities and challenges associated with its large-scale use. Microalgae offer several advantages over traditional biodiesel feedstocks, including high oil content, rapid growth rates, and minimal land use. However, challenges such as high cultivation costs, technical limitations in oil extraction, and scaling production to meet global fuel demands persist. Through a comprehensive review of current research and technological advancements, this paper highlights the innovations being made in microalgal biofuel production, including advancements in genetic engineering, photobioreactor design, and efficient harvesting methods. The study also addresses the economic feasibility of microalgae-based biodiesel, exploring potential solutions for cost reduction and improved efficiency. The findings suggest that while significant hurdles remain, microalgae have the potential to become a key player in the transition to sustainable, renewable energy sources.