As a fascinating visible-light active material, Bi12O17Cl2 has become a new research hotspot in the arena of semiconductor photocatalysis and drawn broad interdisciplinary attention as highly potent catalysts for solar energy conversion and environmental protection. The uniqueness of these layered bismuth-based oxides materials are their potential to harness energy in the visible range, their relative ease of synthesis, cost-effectiveness, great chemical stability, high photoactivity, strong adsorptivity, biologically inert nature, less toxicity, appropriate flat band potential, narrow band gap and environmentally benign. However, the quick reconcilation of the photoproduced charge carrier is a persistent bottleneck in this material. This issue generally manifests in the form of reduced lifetime of photoexcited e(-)-h(+) decreasing the quantum efficiency of diverse light-driven applications. In current years, an enormous research interest is devoted in fabricating Bi12O17Cl2 based robust photocatalysts. This review summarizes the diverse strategies such as morphology control, growth mechanism, metal/non-metal doping, decoration with plasmonic metals, heterojunction/composite formation, the creation of oxygen vacancies etc adopted for improving photocatalytic performance of Bi12O17Cl2. Besides this, relevant achievements of pristine and Bi12O17Cl2-based photocatalysts on the removal of harmful emerging environmental pollutants such as dyes, pesticides, personal care-products, heavy metal ions, pharmaceutical waste, bacteria, gaseous pollutants etc have been discussed in detail. Moreover, efforts are also made to provide a perspective for future research. It is hoped that this review will offer vision by providing some valuable guidance for designing Bi12O17Cl2 as a cocatalyst to fabricate more effective photocatalysts for practical application in environmental pollution management.