The major gas leading to global warming and greenhouse gas emission is elevated carbon dioxide in the atmosphere, which called for effective carbon dioxide mitigation technologies. Traditional carbon dioxide mitigation methods included capture and storage, which involved a series of technologies such as absorption, adsorption, gas-separation membranes and cryogenic distillation. However, these methodologies are considered as cost expensive and non-sustainable. A promising technology is the biological capture of carbon dioxide by using microalgae, which have fast growth rate and high photosynthetic efficiency. The microalgae can fix CO_2 using solar energy with efficiency of ten to fifty times greater than terrestrial plant, and can be cultivated on non-fertile land. In this review, the promising microalgae for effective CO_2 fixation and the effect of CO_2 fixation by microalgae are introduced. The effect of reactor configurations, light intensity, the light/dark cycle, temperature, pH, CO_2 concentration, CO_2 fixation rates, mass transfer and nutrients requirement (including nutrients such as N and P derived from a variety of wastewater sources. e.g., agricultural run-off, concentrated animal feed operations, and industrial and municipal wastewater) on CO_2 fixation are analyzed. Finally, the application and economic viability as well as future trends and perspectives of microalgae biological CO_2 fixation are also discussed in depth.