Abstract Finding renewable alternative energy resources for fossil fuels substitution has become very vital due to the serious challenges faced by humankind at present such as environmental pollution, greenhouse gas emissions, climate change, crude oil price volatility, and fossil fuels exhaustion. Macroalgae (seaweeds) are fast-growing marine plants, providing several harvests per year without the need for arable land, fertilizer, and fresh water. Various types of ecosystems like coral reefs, mangrove forests, and rocky shores can efficiently host the seaweeds production systems. These characteristics have made them highly suitable feedstocks for third-generation bioethanol production. Iran has a huge potential in renewable energy resources owing to its unique geographical location and climatic features. The country borders with the Caspian Sea in the north and with the Persian Gulf and the Gulf of Oman in the south. Seaweeds farming can also play a key role in mitigating air pollution, increasing employment rate, sustaining fossil fuel resources, bioremediating contaminated water, and improving marine ecosystem in the Persian Gulf and the Gulf of Oman. In the present article, macroalgae diversity, cultivation, and their conversion and upgrading technologies into bioethanol in Iran are scrutinized and discussed. Finally, the potential of Bushehr (the Persian Gulf) and Chabahar (the Gulf of Oman) coastlines for macroalgae cultivation is investigated. These locations receive the annual solar radiation in the range of 1680‒1753 kWh/m2 and the photosynthetically active radiation (PAR) in the range of 2.6‒2.71 GJ/m2/year with 3051‒3311.9 h sunshine per annum. Furthermore, the nutrient-rich and calm water with relatively stable pH, salinity, and temperature make these coasts suitable for macroalgae farming. A potential yield up to 147‒153 t/ha/year can be obtained if proper native/engineered species, well-situated sites, and compatible cultivation techniques are selected.