The need of addressing climate change has intensified the search for sustainable and eco-friendly energy sources. It is identified that algae biofuels offer significant advantages over first- and second-generation biofuels. Algae can be cultivated in environments unsuitable for conventional crops, thus not competing with food production. They also demonstrate higher energy density per harvest area and possess remarkable carbon sequestration abilities. Algae biofuels can utilize wastewater, contributing to pollution mitigation and sustainable waste management and could play a crucial role in reducing greenhouse gas emissions, supporting the goals. Their ability to thrive in nonarable environments and use nonpotable water sources presents a sustainable pathway for large-scale biofuel production. The integration of algae biofuels into existing energy frameworks can help transition toward more sustainable energy practices without compromising food security. This chapter underscores the potential of algae biofuels in combating climate change by assessing their environmental benefits, economic viability, and scalability.