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This review discusses the current testing methodologies for COVID-19 diagnosis and explores next-generation sequencing (NGS) technology for the detection of SARS-CoV-2 and monitoring phylogenetic evolution in the current COVID-19 pandemic. The review addresses the development, fundamentals, assay quality control and bioinformatics processing of the NGS data. This article provides a comprehensive review of the obstacles and opportunities facing the application of NGS technologies for the diagnosis, surveillance, and study of SARS-CoV-2 and other infectious diseases. Further, we have contemplated the opportunities and challenges inherent in the adoption of NGS technology as a diagnostic test with real-world examples of its utility in the fight against COVID-19.