The increasing emphasis on environmental sustainability and the need for eco‐friendly solutions has intensified interest in bio‐fabricated titanium dioxide (TiO2) nanoparticles due to their unique properties and versatile applications. This review provides a comprehensive insight into the synthesis of TiO2 nanoparticles using various biological sources, including plants and microorganisms, highlighting the advantages of green synthesis methods over conventional techniques. The antimicrobial activity of bio‐fabricated TiO2 nanoparticles against a range of pathogens, including Escherichia coli, Bacillus subtilis, opportunistic species of Staphylococcus, Teschovirus A, Trichoderma, Candida albicans has been examined and scripted in various research papers, along with the underlying mechanisms that contribute to their efficacy. Additionally, the potential of TiO2 nanoparticles in cancer therapy is explored, focusing on their ability to induce apoptosis in cancer cells and their applications in photodynamic therapy. Furthermore, the discussion on the environmental applications of TiO2 nanoparticles, including their role in wastewater treatment, air purification, and as photocatalysts for the degradation of organic pollutants, in agriculture, energy production, electronic sensing emphasized its importance in maintaining environmental sustainability. By elucidating the multifaceted roles of bio‐fabricated TiO2 nanoparticles, this study underscores their potential as a promising alternative in healthcare and environmental management, paving the way for future research and applications in nanotechnology.