Rhodotorula toruloides is a non-conventional red yeast that can synthesize various carotenoids and lipids. It can utilize a variety of cost-effective raw materials, tolerate and assimilate toxic inhibitors in lignocellulosic hydrolysate. At present, it is widely investigated for the production of microbial lipids, terpenes, high-value enzymes, sugar alcohols and polyketides. Given its broad industrial application prospects, researchers have carried out multi-dimensional theoretical and technological exploration, including research on genomics, transcriptomics, proteomics and genetic operation platform. Here we review the recent progress in metabolic engineering and natural product synthesis of R. toruloides, and prospect the challenges and possible solutions in the construction of R. toruloides cell factory.