In times of global warming and upcoming fossil fuel shortages, the demand for the replacement of current fossil fuel-based chemical production via the development of alternative technologies and sustainable resources has increased. As a possible solution, an approach that produces chemicals from C1 gases derived from industrial waste gas or syngas has been suggested, but inefficient costs and syngas contaminant-sensitive processes of chemical catalysts have limited C1 gas utilization. Recently, acetogenic bacteria have received much attention as potential biocatalysts capable of C1 gas valorization into value-added chemicals. A comprehensive overview of C1 gas conversion using acetogenic bacteria as biocatalysts and a wide range of value-added products converted from C1 gases is provided in this review. Additionally, several strategies for enhancing product yield and alcohol selectivity during the gas fermentation processes, converting native products into valuable longer carbon compounds through coupling gas fermentation with additional processes, and overcoming energetic limitations underlying acetogenic bacteria via strain engineering are discussed.