Microbial pigments are chemical moieties capable of absorbing light in the visible range. The demand for natural colorants is increasing in every day as the present trend throughout the world is shifting towards the use of ecofriendly and biodegradable commodities. Among the natural sources, the pigment producing microorganisms hold a promising potential to meet present day challenges. Pigments are compounds that come in a wide variety and extensively used in industries. Industrial production of natural pigments by microbial fermentation has several advantages over extraction of pigments of plant origin, such as easy availability of inexpensive raw materials for their production, independence from crop seasons and their seasonal variations, etc. The Pseudomonas aeruginosa has ability to produce a number of redox-active phenazine compounds including pyocyanin. The pyocyanin pigment possesses antimicrobial, anticancerous, antioxidant, anti-inflammatory and immunosupperessive proper ties. This review covers the challenges and new insights into pyocyanin from P. aeruginosa with emphasis on the role of pyocyanin in P. aeruginosa infection with special attention to applications of pyocyanin pigment.