The massive improvement in food production, as a result of effective genetic selection combined with advancements in farming practices, has been one of the greatest achievements of modern agriculture. For instance, the dairy cattle industry has more than doubled milk production over the past five decades, while the total number of cows has been reduced dramatically. This was achieved mainly through the intensification of production systems, direct genetic selection for milk yield and a limited number of related traits, and the use of modern technologies (e.g., artificial insemination and genomic selection). Despite the great betterment in production efficiency, strong drawbacks have occurred along the way. First, across-breed genetic diversity reduced dramatically, with the worldwide use of few common dairy breeds, as well as a substantial reduction in within-breed genetic diversity. Intensive selection for milk yield has also resulted in unfavorable genetic responses for traits related to fertility, health, longevity, and environmental sensitivity. Moving forward, the dairy industry needs to continue refining the current selection indexes and breeding goals to put greater emphasis on traits related to animal welfare, health, longevity, environmental efficiency (e.g., methane emission and feed efficiency), and overall resilience. This needs to be done through the definition of criteria (traits) that (a) represent well the biological mechanisms underlying the respective phenotypes, (b) are heritable, and (c) can be cost-effectively measured in a large number of animals and as early in life as possible. The long-term sustainability of the dairy cattle industry will also require diversification of production systems, with greater investments in the development of genetic resources that are resilient to perturbations occurring in specific farming systems with lesser control over the environment (e.g., organic, agroecological, and pasture-based, mountain-grazing farming systems). The conservation, genetic improvement, and use of local breeds should be integrated into the modern dairy cattle industry and greater care should be taken to avoid further genetic diversity losses in dairy cattle populations. In this review, we acknowledge the genetic progress achieved in high-yielding dairy cattle, closely related to dairy farm intensification, that reaches its limits. We discuss key points that need to be addressed toward the development of a robust and long-term sustainable dairy industry that maximize animal welfare (fundamental needs of individual animals and positive welfare) and productive efficiency, while also minimizing the environmental footprint, inputs required, and sensitivity to external factors.