Water and energy are critical components for human, and govern the growth and progress of societies. Desalination is an important process to meet ever-increasing water demand, although it is an energy-intensive alternative compared to conventional water treatment techniques. Demand for desalination has been expanded rapidly as traditional water sources are getting overexploited. Membrane distillation (MD) is a promising water treatment process for highly saline water, including reject from the reverse osmosis plants. To compensate for high energy requirement for the MD process, low-grade heat sources (such as waste heat or renewable sources) can be used. Limitations of other desalination processes are discussed in this review to underline evolution and tweaking of alternatives for making them optimal. In this review, we examine the suitability of the MD process for harnessing energy from different types of low-grade heat sources to make it cost-effective. Financial aspects of the MD process for different heat sources are also highlighted. A summary of studies focusing on hybrid MD systems is also provided. Finally, challenges, opportunities and current implementation of the MD process by using low-grade heat-based MD systems are discussed.