Cereal and legume proteins, pivotal for human health, significantly influence the quality and stability of processed foods. Despite their importance, the inherent limited functional properties of these natural proteins constrain their utility across various sectors, including the food, packaging, and pharmaceutical industries. Enhancing functional attributes of cereal and legume proteins through scientific and technological interventions is essential to broadening their application. Cold plasma (CP) technology, characterized by its non-toxic, non-thermal nature, presents numerous benefits such as low operational temperatures, lack of external chemical reagents, and cost-effectiveness. It holds the promise of improving proteins’ functionality while maximally retaining their nutritional content. This review delves into the pros and cons of different cold plasma generation techniques, elucidates the underlying mechanisms of protein modification via CP, and thoroughly examines research on the application of cold plasma in augmenting the functional properties of proteins. The aim is to furnish theoretical foundations for leveraging CP technology in the modification of cereal and legume proteins, thereby enhancing their practical applicability in diverse industries.