The development of eco-friendly technologies in material synthesis is of considerable importance to expand their biological applications. Nowadays, a variety of inorganic nanoparticles with well-defined chemical composition, size, and morphology have been synthesized by using different microorganisms, and their applications in many cutting-edge technological areas have been explored. This paper highlights the recent developments of the biosynthesis of inorganic nanoparticles including metallic nanoparticles, oxide nanoparticles, sulfide nanoparticles, and other typical nanoparticles. Different formation mechanisms of these nanoparticles will be discussed as well. The conditions to control the size/shape and stability of particles are summarized. The applications of these biosynthesized nanoparticles in a wide spectrum of potential areas are presented including targeted drug delivery, cancer treatment, gene therapy and DNA analysis, antibacterial agents, biosensors, enhancing reaction rates, separation science, and magnetic resonance imaging (MRI). The current limitations and future prospects for the synthesis of inorganic nanoparticles by microorganisms are discussed.