Biosurfactants are extracellular microbial products that show a high degree of structural, functional and chemical heterogeneity. In comparison with synthetic surfactants, biosurfactants exhibit environmental compatibility, biodegradability, high reaction rate, astonishing chemical diversity, and better physiochemical characters. In the first phase of study, physicochemical characterization of crude oil affected and unaffected soil of Chak Naurang, Punjab, Pakistan was done. Results demonstrated that the contaminated soil was slightly alkaline clay-loam with TPH of 22.2 g/kg and TOC of 23.11 g/kg. The concentration of nitrogen, phosphorus and potassium was found to be quite low i.e. 0.644 g/kg, 12.46 mg/kg and, 20 mg/kg, respectively. Enrichment and isolation experiments were typically designed to obtain indigenous biosurfactants producing microorganisms of crude oil contaminated soil. Amongst forty isolates, qualitative and quantitative screening for biosurfactants production confirmed fourteen potential microorganisms, which were identified through morphological, microscopic, biochemical and molecular studies. The two most efficient biosurfactants producing microorganisms i.e. Pseudomonas aeruginosa MF069166 with 84 % of E.I24, 26.6 mN/m of S.T, 8 cm of oil displacement zone and, Meyerozyma spp. MF138126 with 82 % of E.I24, 26 mN/m of S.T and 7.4 cm of oil displacement zone were selected for further studies of bioprocess optimization, characterization and environmental applications of biosurfactants.In the second phase of study out of five different fermentation media, M 2 was found to be the most suitable for P. aeruginosa MF069166 whereas, M 5 for Meyerozyma spp. MF138126. Plackett-Burman optimization showed that glycerol, K2HPO4, peptone, KNO3, NaCl, yeast extract and MgSO4 were significant components of M 2 for maximum rhamnolipids production (3.46 g/L) from P. aeruginosa MF069166 whereas, peptone, glycerol, NaH2PO4, yeast extract and MgSO4 were significant components of M 5 for maximum sophorolipids production (4.02 g/L) from Meyerozyma spp. MF138126. Optimization of culture conditions using Response Surface Methodology revealed that the predicted values of pH; 6.5, T; 35 °C, SOI; 3.4 % and agitation speed of 120 RPM resulted in maximum growth of 3.06 and rhamnolipids production of 4.31 g/L from P. xiii aeruginosa MF069166. In case of Meyerozyma spp. MF138126, the predicted values of pH; 5.5, T; 33.2 °C, SOI; 3.3 % and agitation speed of 161 RPM resulted in maximum growth of 3.17 and sophorolipids production of 6.9 g/L.Chemical characterization techniques of TLC, FTIR, RP-HPLC, 1H and 13CNMR and LC-ESI-MS confirmed that biosurfactants produced by P. aeruginosa MF069166 and Meyerozyma spp. MF138126 were rhamnolipids and sophorolipids, respectively. The stability of rhamnolipids was witnessed from 15-121 oC T, 4-11 pH and 2-10 % NaCl whereas, the stability of sophorolipids was observed from 5-115 oC T, 3-10 pH and 2-10 % NaCl. Cell surface hydrophobicity (CSH) studies showed more than 50 % affinity of the two isolates for crude oil, hexadecane and dodecane whereas, more than 70 % emulsification activity was observed by their respective rhamnolipids and sophorolipids in the presence of different hydrocarbons. cmc of rhamnolipids was found to be 40 mg/L whereas, the cmc of sophorolipids was 50 mg/L. z-average diameter of purified rhamnolipids and sophorolipids was noted under the effect of varying cmc, pH and electrolytes through Dynamic Light Scattering technique. In the final phase of study, role of P. aeruginosa MF069166 and Meyerozyma spp. MF138126 and, their respective rhamnolipids and sophorolipids was evaluated in biodegradation of crude oil and bioremediation of heavy metals. In crude oil degradation experiments, gravimetric and GC-MS analysis demonstrated that the bacterial strain degraded 90 % of the petroleum hydrocarbons while the yeast species showed 85 % biodegradation efficiency after 14 days of incubation period. Results of heavy metals bioremediation studies indicated more than 75 % removal of zinc from aqueous phase and contaminated soil through metal chelating activity of rhamnolipids. Similarly, sophorolipids were able to precipitate out more than 80 % of lead from the two phases. Kinetic study of biosurfactants mediated soil washing demonstrated a gradual increase in percentage removal of lead and zinc with the passage of time. These findings suggested that biosurfactants producing P. aeruginosa MF069166 and Meyerozyma spp. MF138126 have high potential to be used in different environmental applications and can be considered as suitable candidates for field scale bioremediation studies.