The rapid growth of the world's population, urbanization, and increasing prosperity require better utilization of available protein resources. In addition, the development of new and sustainable resources is also very important. By 2050, the increase in protein demand in the world will cause it to double not only due to population pressure but also to the increasing awareness of the importance of proteins in a healthy diet for the elderly population. Fish and other aquatic products are important sources of protein. However, depending on the raw materials and the processes applied in the seafood processing sector, waste and by-products are generated at rates ranging from 20% to 75%. Many studies have shown that these products are important protein sources. However, the inadequate management of waste and by-products in the seafood processing sector is one of the biggest challenges facing the fish industry today. Various processes have been developed for the use of these products. An effective way to add value to these products is the production of protein hydrolyzates. Protein hydrolysates allow the release of peptides of different sizes with functional properties, various bioactivities such as antioxidant, antimicrobial, antihypertensive, anti-inflammatory, or antihyperglycemic. In this article, proteins belonging to fish by-products and wastes, their functional and technological properties, hydrolysis process, technological use of hydrolysates in the food industry have been reviewed.