Continuous population growth has increased the demand for food and nutrition, which leads to a decline in agricultural land needed per person to grow crops. Thus, it is essential to find alternative sources to meet nutritional requirements. Algae have become a potential and sustainable alternative source of protein, which has a high nutritional value. Due to their high protein content microalgae are commonly used as a nutritional supplement in the form of powder, pills, or tablets. Algal proteins can be efficiently isolated using various extraction methods, and can be a good source of food additives. Additionally, they have been added to a variety of functional foods, such as noodles, bread, biscuits, beverages, chocolates, and beer. This review provides a comprehensive, and critical overview of cultivation, harvesting, extraction, and numerous applications of microalgae as a potential source of protein. Algae cultivation under different growth conditions as well as algae harvesting from algal biomass is summarized. Recent advances in algal extraction methods, such as physical/chemical extraction as well as assisted extraction methods including pulsed electric field, ultrasound, enzyme, and microwave are summarized and discussed. Additionally, information on the nutritional content of different types of algae in terms of protein, lipid, and carbohydrate content as well as microalgae-derived bioactive peptides, phycobiliproteins, and amino acids is provided.