During the past few years, the production of natural value-added compounds from microbial sources has gained tremendous importance. Due to an increase in consumer demand for natural products, various food and pharmaceutical industries are continuously in search of novel metabolites obtained from microbial biotransformation. The exploitation of microbial biosynthetic pathways is both feasible and cost effective in the production of natural compounds. The environmentally compatible nature of these products is one major reason for their increasing demand. Novel approaches for natural product biogeneration will take advantage of the current studies on biotechnology, biochemical pathways and microbiology. The interest of the scientific community has shifted toward the use of microbial bioconversion for the production of valuable compounds from natural substrates. The present review focuses on eugenol biotransformation by microorganisms resulting in the formation of various value-added products such as ferulic acid, coniferyl alcohol, vanillin and vanillic acid.