I'm not an expert in this topic, so please excuse my negligence. I'd also appreciate references to the literature. Throughout, I will work over the complex numbers, although the analogous questions could be asked over other fields, and they may even be more interesting in that situation. Let $M\_g$ denote the moduli space of smooth projective curves of genus $g$. Is $M\_g$ rational (i.e., birational to a projective space) for a general integer $g\geq 1$?


This is true when $g=1$, as $M\_1$ is then just the moduli space of elliptic curves. I'm not sure how to show this for genus $2$, but note that as genus $2$ curves are hyperelliptic, the moduli space $M\_2$ can be identified with $(\mathbf{P}^1)^6/(\mathrm{SL}\_2\cdot\Sigma\_6) = \mathbf{P}^6/\mathrm{SL}\_2$, so it's at least unirational. (I think that this is even true when we work over a field of characteristic not $2$.) This suggests that the first step in proving rationality would be showing that $M\_g$ is in general birationally equivalent to quotient of $\mathbf{P}^N$ by a reductive group, which implies that it is unirational. Rationality seems harder. The article <https://arxiv.org/abs/0804.1509> shows that $M\_3$ is also rational, and my thoughts about unirationality seem to be confirmed in the introduction. What about genus greater than $3$?



Rationality of the moduli space of genus g curves
Your question is a plausible guess; indeed, Severi conjectured that $\mathcal{M}\_g$ is unirational for all $g$. He proved this conjecture for $g\leq 10$. Sernesi was first to prove unirationality of $\mathcal{M}\_g$ in genus 12, then Chang and Ran proved it in genera 11 and 13, Verra in genus 14. Bruno and Verra have shown that $\mathcal{M}\_{15}$ is rationally connected.


The picture is quite different for higher genera. For instance, Harris and Mumford proved that $\bar{\mathcal{M}\_g}$ is a variety of general type for $g\geq 24$; Farkas did this for $g=22$. Farkas proved that the Kodaira dimension of $\bar{\mathcal{M}\_{23}}$ is at least 2 and conjectures that this is, in fact, an equality. 


A good exposition on this topic can be found in Farkas' "Birational aspects of the geometry of $\bar{\mathcal{M}\_g}$". 


