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Immobilization is the method of entrapping/attaching the microbial or plant cells in a suitable matrix. Different methods such as encapsulation, gel entrapment, covalent bonding, cross linking and adsorption is carried out to prepare immobilized cells. When compared to enzyme immobilization, cell immobilization is regarded as a convenient method because of its low cost and improved stability. The cost of isolation and purification is very high in enzyme immobilization. These immobilized cells are mainly used in the areas of biotechnology and industrial production. This paper reviews the various methods of immobilization and application of immobilized cells in waste treatment and biodiesel production.