Abstract Large quantity of animal waste production in Bangladesh has spurred the demand of potential applications for waste management. Therefore, biofuel production from animal waste has been projected as the solution for animal waste management along with the potential of a new source of renewable energy. This study aimed to evaluate the production of biogas from the farm wastes in Bangladesh and presented the potential biological applications for processing the wastes to convert into biogas. The study demonstrated that the highest amount of livestock waste, approximately 229 million ton was produced in 2016 and it was accounted for a total biogas production potential of 16988.97 million m3 which could be converted into 16.68 × 107 MWh of electricity. This study also presented the suitable conversion technologies as well as mechanisms of biogas production from animal waste and related mathematical equations to calculate the amount of total biogas productions. The latest advancements in large scale biogas production via government and non-government organizations have also been documented in this work. Besides biogas production analysis, this study also demonstrated the environmental impacts of biogas application. A net CO2 emission reduction of 4.42 million tons could have been achieved over the diesel power generation along with 29 million ton of biofertilizer. The study also proposed a management plan to improve the current waste removal situation in Bangladesh. Along with that, this review comprehensively outlined the worldwide scenario of biogas production and applications.