Abstract Purpose of Review This review explores the potential of fish by-products as a source of bioactive peptides for the food, pharmaceutical, and cosmetic industries. Focusing on their diverse bioactive and functional properties, it offers insights into their industrial utilization, contributing to a better understanding of their applications. Recent Findings Fish processing by-products, including wastewater and solid residues, serve as valuable sources of bioactive peptides exhibiting a remarkable range of biological activities, such as antioxidant, antimicrobial, and antihypertensive properties. These peptides exhibit a wide range of functional properties, such as solubility, water holding, fat binding, foaming, and emulsifying capacities. Moreover, they show significant potential for various industrial applications. Summary Bioactive peptides derived from fish by-products are attracting interest in multiple industries due to their diverse biological activities and functional properties. These peptides have emerged as a valuable and largely untapped resource, as they can be extracted from underutilized, or waste materials generated during fish processing operations. Graphical Abstract