Water is essential for every living being. Increasing population, mismanagement of water sources, urbanization, industrialization, globalization, and global warming have all contributed to the scarcity of fresh water sources and the growing demand of such resources. Securing and allocating sufficient water resources has thus become one of the current major global challenges. Membrane technology has dominated the field of water purification due to its ease of usage and fabrication with high efficiency. The development of novel membrane materials can hence play a central role in advancing the field of membrane technology. It is noted that polymer-clay nanocomposites have been used widely for treatment of waste water. Nonetheless, not much efforts have been put to functionalize their membranes to be selective for specific targets. This review was organized to offer better insights into various types of functional polymer and clays composite membranes developed for efficient treatment and purification of water/wastewater. Our discussion was extended further to evaluate the efficacy of membrane techniques employed in the water industry against major chemical (e.g., heavy metal, dye, and phenol) and biological contaminants (e.g., biofouling).