Metagenomics is the direct genetic analysis of genomes contained with an environmental sample of entire communities of organisms which comprises both genomic technologies and bioinformatics tools. At first cloning of environmental DNA is done, and then followed by screening for functional expression. Sequencing is done by fosmid, cosmid and bacterial artificial chromosome derived metagenomic studies, Sanger sequencing derived shotgun metagenomic studies and next-generation sequencing derived shotgun metagenomic studies. Broadly metagenomics focuses the metatranscriptomics and metaproteiomics giving genetic information of novel biocatalysts or enzymes, genetic linkage and phylogenetic study of uncultured organisms and evolutionary profiles of community function and structure. The steps followed in functional metagenomic study are experimental design, sample processing, sequencing technology, assembly, binning, annotation, statistical analysis, data storage and sharing of data. The development of sequence based metagenomics has substantially reduces the cost of processing and quite rapid in action. Analysis of species populations and their interaction, results that both species composition and interaction changes over time and response to environmental stimuli. Metagenomic data and metadata can be leveraged towards designing low and high throughput experiments defining the roles of genes and microorganisms in the establishment of a dynamic microbial community. Metagenomics is useful in identification of the complex consortium of bacteria, protozoa, archeae, fungi etc. and interaction among them results in better feed degradation and productivity of animals. It helps in formulating the feed ingredients consisting of probiotics and in immunomodulation both in animals and poultry.