Bacterial cellulose (BC) has emerged as a promising sustainable biomaterial owing to its unique structural, physicochemical, and functional properties that distinguish it from plant-derived cellulose. Produced extracellularly by cellulose-synthesizing bacteria, particularly Komagataeibacter and Acetobacter species, BC exhibits exceptional purity, high crystallinity, superior mechanical strength, excellent water-holding capacity, biodegradability, biocompatibility and a three-dimensional nanofibrillar network. These characteristics have led to its increasing application in the food, biomedical, and industrial sectors. This review summarizes the structure, microbial sources, biosynthesis, and production strategies of bacterial cellulose, highlighting the influence of bacterial strain selection, genetic engineering, culture media, low-cost feedstocks, and bioreactor design on production efficiency and commercial feasibility. The use of agricultural and industrial waste substrates, along with optimized fermentation systems, offers a sustainable and cost-effective approach for enhancing BC production. The review also discusses the diverse applications of BC in the food industry, including fermented products such as nata de coco and nata de pina, dietary fibre, stabilizer, thickening agent, fat replacer, and biodegradable food packaging material with antimicrobial and antioxidant properties that improve food quality and shelf life. Furthermore, its biomedical applications in wound dressings, tissue engineering, vascular grafts, and regenerative medicine are highlighted due to its excellent biocompatibility and capacity for functional modification. Despite significant progress, challenges associated with large-scale production, process optimization, and cost-effective commercialization remain. Continued advances in microbial engineering, production technologies, and composite development are expected to enhance the commercial potential of bacterial cellulose as an eco-friendly, high-performance biomaterial for future food, healthcare, and industrial applications.