To meet stringent emission standards stipulated by regulatory agencies, the oil industry is required to make a huge investment to bring down the sulfur content in diesel to the desired level, using conventional hydrodesulfurization (HDS) technology, by which sulfur is catalytically converted to hydrogen sulfide in the presence of hydrogen. These reactions proceed rapidly only at high temperature and pressure and therefore the capital cost as well as the operating cost associated with HDS very high. Biological desulfurization has the potential of being developed as a viable technology downstream of classical HDS. Various attempts have been made to develop biotechnological processes based on microbiological desulfurization employing aerobic and anaerobic bacteria. However, there are several bottlenecks limiting commercialization of the process. This review discusses various aspects of microbial desulfurization and the progress made towards its commercialization.