D-Galactose is an abundant carbohydrate monomer in nature and widely exists in macroalgae, plants, and dairy wastes. D-Galactose is useful as a raw material for biomass fuel production or low-calorie sweetener production, attracting increased attention. This article summarizes the studies on biotechnological processes for galactose utilization. Two main research directions of microbial fermentation and enzyme-catalyzed conversion from galactose-rich biomass are extensively reviewed. The review provides the recent discoveries for biofuel production from macroalgae, including the innovative methods in the pretreatment process and technological development in the fermentation process. As modern people pay more attention to health, enzyme technologies for low-calorie sweetener production are more urgently needed. D-Tagatose is a promising low-calorie alternative to sugar. We discuss the recent studies on characterization and genetic modification of L-arabinose isomerase to improve the bioconversion of D-galactose to D-tagatose. In addition, the trends and critical challenges in both research directions are outlined at the end.