Weather variations and global heating, are the serious issues of the time that make us think about how to preserve our environment for generations to come and what type of projects can benefit society, if any business initiatives are being taken and, nowadays, even financial institutions are paying attention to green finance projects or environment-friendly projects as sustainable investment is the order of the day. This paper sightsees the involvement of green finance in transforming the traditional resource-consuming economy into an economy of green energy generation and consumption with a focus on developing countries by examining important financial instruments, investment strategies, and policy frameworks that facilitate the achievement of sustainable development objectives. It explores the potential and challenges various stakeholders face, including authorities, financial institutions, and individual investors, to unify capital for a sustainable environment. The report also emphasizes the increasing importance of innovative financial products, including green bonds, carbon credits, and Environmental, Social, and Governance (ESG) investments, in transforming global financial markets. The findings show that there have been crucial advancements on the subject; however, there are still considerable obstacles associated with regulatory loopholes and uneven market maturity in realizing the full potential and benefits of green finance. This study adds to the burgeoning dialogue surrounding sustainable finance and offers practical recommendations for policymakers and investors trying to align financial resource allocation with climate and environmental objectives.