Lawsonia inermis, commonly known as henna, is a plant belonging to the Lythraceae family, valued for its commercial and medicinal properties. This review aims to provide a comprehensive overview of the phytochemistry, pharmacological activities, and toxicological profile of L. inermis. The plant is widely cultivated in tropical regions of Asia, Africa, and the Americas, particularly in India, Pakistan, Iran, and North Africa. Henna has been traditionally used as a cooling agent, astringent, antifungal, and antibacterial herb for skin and hair. It has also been employed as a dye and preservative for hair, skin, fingernails, leather, and clothes. L. inermis is renowned for its abundance of vitamins, minerals, and various chemical constituents, including flavonoids, tannins, saponins, alkaloids, and naphthoquinones. These bioactive compounds have been shown to possess diverse pharmacological properties, such as immunomodulatory, antiviral, antibacterial, antifungal, nootropic, antifertility, hepatoprotective, antimitotic, analgesic, anti-inflammatory, and anticarcinogenic activities. This review discusess about the recent scientific literature on the phytochemistry, traditional uses, pharmacological activities, and toxicological aspects of L. inermis. The potential applications of henna in the pharmaceutical, cosmetic, and food industries are also discussed, along with future research directions.