Abstract: The intensification of human activities has resulted in pervasive toxic metal pollution in water bodies, thereby endangering ecosystems and human health through bioaccumulation in food chains. Decontamination technology, recognized for its cost-effectiveness, versatility, and minimal secondary pollution, has garnered considerable attention. Among the diverse methods, photosynthetic microalgae exhibit considerable potential in the purification of toxic metals. These microalgae actively remove toxic metals through diverse molecular mechanisms during their life cycle, and continue to purify water via residual adsorption after death. This review explores the molecular response mechanisms of microalgae under toxic metal stress and the environmental factors affecting their decontamination efficiency. A comparative analysis of live vs. non-living algal biomass highlights the dynamic remediation advantages of live algae and the rapid treatment potential of non-living algae. The present review also discusses the sustainability and regeneration potential of microalgae as biosorbents. Furthermore, it elucidates the potential of microalgae-based toxic metal applications, while also delineating the challenges in the domain of toxic metal decontamination.