Evaluation of biological effects using a rapid, sensitive and cost effective method can indicate specific information on toxicity/ecotoxicity. Since assays based on animals, plants and algae are expensive, time consuming and require large sample volume, recent studies have emphasized the benefits of rapid, reproducible and cost effective bacterial assays for toxicity screening and assessment. This review focuses on a bacterial assay, i.e., Vibrio fischeri bioluminescence inhibition assay, which is often chosen as the first test in a test battery based on speed and cost consideration. The test protocol is simple and was originally applied for aqueous phase samples or extracts. The versatility of the assay has increased with subsequent modification, i.e., the kinetic assay for turbid and colored samples and the solid phase test for analyzing sediment toxicity. Researchers have reported the Vibrio fischeri bioluminescence assay as the most sensitive across a wide range of chemicals compared to other bacterial assays such as nitrification inhibition, respirometry, ATP luminescence and enzyme inhibition. This assay shows good correlations with other standard acute toxicity assays and is reported to detect toxicity across a wide spectrum of toxicants.