Bio-mechatronics is an interdisciplinary scientific field that emphasizes the integration of biology and mechatronics to discover innovative solutions for numerous biomedical applications. The broad application spectrum of bio-mechatronics consists of minimally invasive surgeries, rehabilitation, development of prosthetics, and soft wearables to find engineering solutions for the human body. Fiber-optic-based sensors have recently become an indispensable part of bio-mechatronics systems, which are essential for position detection and control, monitoring measurements, compliance control, and various feedback applications. As a result, significant advancements have been introduced for designing and developing fiber-optic-based sensors in the past decade. This review discusses recent technological advancements in fiber-optical sensors, which have been potentially adapted for numerous bio-mechatronic applications. It also encompasses fundamental principles, different types of fiber-optical sensors based on recent development strategies, and characterizations of fiber Bragg gratings, optical fiber force myography, polymer optical fibers, optical tactile sensors, and Fabry–Perot interferometric applications. Hence, robust knowledge can be obtained regarding the technological enhancements in fiber-optical sensors for bio-mechatronics-based interdisciplinary developments. Therefore, this review offers a comprehensive exploration of recent technological advances in fiber-optical sensors for bio-mechatronics. It provides insights into their potential to revolutionize biomedical and bio-mechatronics applications, ultimately contributing to improved patient outcomes and healthcare innovation.