Bacterial nanocellulose (BNC) has emerged as a natural biopolymer of significant importance in diverse technological areas due to its incredible physicochemical and biological characteristics. However, the high capital investments, production cost and lack of well-organized scale-up processes resulting in low BNC production are the major impediments need to be resolved. This review enfolds the three different and important portions of BNC. Firstly, advancement in production technologies of BNC like cell-free extract technology, static intermittent fed batch technology and novel cost-effective substrates that might surmount the barriers associated with BNC production at industrial level. Secondly, as BNC and its composites (with other polymers/nanoparticles) represents the utmost material of preference in current regenerative and diagnostic medicine, therefore recently reported biomedical applications of BNC and functionalized BNC in drug delivery, tissue engineering, antimicrobial wound healing and biosensing are widely been focused here. The third and the most important aspect of this review is an in-depth discussion of various pitfalls associated with BNC production. Recent trends in BNC research to overcome the existing snags that might pave a way for industrial scale production of BNC thereby facilitating its feasible application in various fields are highlighted.