Microbial exopolysaccharides (EPS) are extracellular carbohydrate polymers forming capsules or slimy coating around the cells. EPS can be secreted by various bacterial genera that can help bacterial cells in attachment, environmental adaptation, stress tolerance and are an integral part of microbial biofilms. Several gut commensals (e.g., Lactobacillus, Bifidobacterium) produce EPS that possess diverse bioactivities. Bacterial EPS also has extensive commercial applications in the pharmaceutical and food industries. Owing to the structural and functional diversity, genetic and metabolic engineering strategies are currently employed to increase EPS production. Therefore, the current review provides a comprehensive overview of the fundamentals of bacterial exopolysaccharides, including their classification, source, biosynthetic pathways, and functions in the microbial community. The review also provides an overview of the diverse bioactivities of microbial EPS, including immunomodulatory, anti-diabetic, anti-obesity, and anti-cancer properties. Since several gut microbes are EPS producers and gut microbiota helps maintain a functional gut barrier, emphasis has been given to the intestinal-level bioactivities of the gut microbial EPS. Collectively, the review provides a comprehensive overview of microbial bioactive exopolysaccharides.