The burgeoning population and continuous increase in developmental activities are the major cause of rampant release of numerous environmental contaminants. These contaminants pollute the soil, air and water and ultimately enter the food chain. Several physical, chemical and biological techniques have been developed to remove these contaminants; however, these methods are quite costly and not environmentally sound. Specifically, organic contaminants like pesticides, phenols, oils, pharmaceuticals and dyes are entering aquatic habitats and damaging these ecosystems. Application of aquatic macrophytes for the removal of organic contaminants has proved to be an eco-friendly and efficient tool to remediate aquatic ecosystems. Aquatic macrophytes such as Eichhorn crassipes, Elodea canadensis, Lemna minor, Pistia stratiotes, and Trapa natans can be used for reclamation of contaminated waste and wastewater systems. In addition, these plants help in carbon sequestration, and the biomass of these plants may be used to produce bioenergy (biofuel) at the same time. In this chapter, the potential of aquatic macrophytes for phytoremediation and bioenergy production along with carbon sequestration have been thoroughly discussed.