Generative Artificial Intelligence models are Artificial Intelligence models that generate new content based on a prompt or input. The output content can be in various forms, including text, images, and video. Metaverse refers to a virtual world where users can interact with each other, objects and events in an immersive, realistic, and dynamic manner. A critical and foremost step in realizing the Metaverse is content creation for its different realms. Given Metaverse’s need for enormous content, Generative AI is a perfect technology for content creation. This paper explores how Generative AI models can help fulfil the potential of the Metaverse by assisting in the design and production of various aspects of the Metaverse and attracting users not just by creating dynamic, interactive, and personalised content at scale but also by producing various revenue-generating opportunities for users and organisations in the Metaverse. The paper analyses the Generative AI models by grouping them according to the type of content they generate, namely text, image, video, 3D visual, audio, and gaming. Various use cases in the Metaverse are explored and listed according to each type of AI Generated Content (AIGC). This paper also presents several applications and scenarios where the mixture of different Generative AI (GAI) models benefits the Metaverse. Further, this paper also enumerates the limitations and challenges of Generative AI models and the areas of future work. Despite the obstacles, Generative AI can realise the potential of the Metaverse by making it much more functional and interactive owing to the vast use cases of different types of AIGC in the Metaverse, and the age of virtual reality may not be too distant.