Industrial discharges contaminated with synthetic dyes are responsible for causing serious harm to ecology and living beings. Current knowledge on microorganism-based technologies for removing dyes has been synthesized in this review. To promote scalability and safety in bioremediation, emphasis has been placed on single isolates, engineered and natural consortia, genetically modified strains, computational prescreening, the role of mediators and energy supplements, analytical workflows, and ecotoxicity assessment. In summary, multispecies consortia are more resilient than single isolates and can decolorize broad-spectrum dyes. Azoreductases, laccases, and ligninolytic peroxidases remain the dominant enzymes that catalyze this process. Sometimes, better mineralization in downstream processes is achieved with microaerophilic or sequential anaerobic‒aerobic systems. Prescreening by computational (docking, homology modeling, metabolic reconstructions) and in silico methods minimizes the time and labor required for selecting the appropriate candidate and provides critical insights into enzyme–dye complementarity. While a multiple-fold rate increase is achieved with additional redox mediators and co-substrates, treated effluent may also retain or generate toxic intermediates, which underscores that visual decolorization does not represent detoxification. Although the performance of the process can be improved by engineering principles (top-down enrichment, bottom-up synthetic consortia, and spatial immobilization) and targeted genetic transfers, biosafety and scale-up challenges are the major drawbacks of these processes. Industrial translation of microbe-based systems requires standardized toxicity assessments, the design of adaptable reactors, and regular containment and life-cycle assessments.