Microbes contribute to geochemical cycles in the ecosystem. They also play important roles in biodegradation and bioremediation of contaminated environments, and have great potential in energy conversion and regeneration. Up to date, at least 150 genomes of non-pathogenic microbes have been sequenced, of which, the majority are bacteria from various environments or of industrial uses. The emerging field 'metagenomics' in combination with the high-throughput sequencing technology offers opportunities to discover new functions of microbes in the environment on a large scale, and has become the 'hot spot' in the field of environmental microbiology. Seven genomes of bacteria from various extreme environments, including high temperature, high and low pressure, and extreme acidic regions, have been sequenced by researchers in China, leading to the discovery of metabolic pathways, genetic functions and new enzymes, which are related to the niches those bacteria occupy. These results were published in Nature, PNAS, Genome Research and other top international journals. In the meantime, several groups in China have started 'metagenomics' programs. The outcomes of these researches are expected to generate a considerable number of novel findings, taking Chinese researchers to the frontier of genomics for environmental and industrial microorganisms.