Goat and sheep meat production is a challenge for the meat industry as well as for environmental management. Yet within cultures, certain by-products, such as liver, the lungs, heart, brain, spleen, blood, tail and ears, are traditionally used in the production of typical dishes for regional or local cuisine. These by-products are a rich source of lipids, proteins, essential amino acids, B-complex vitamins, and minerals. They can be effectively exploited for higher (value-added) applications, including functional foods or feed ingredients, food supplements, enzymes and other chemical products such as hydrolyzed proteins and flavorings. This review article gathers data on: (i) the production of by-products obtained from slaughter and available for processing, and (ii) potential strategies for using and applying these by-products in obtaining new value-added ingredients. Other than proteins, the review discusses other macromolecules and possible uses of these by-products in culinary dishes, as hydrolyzed enzymes, and as food additives. Even though these by-products undoubtedly present themselves as rich in nutrients, there remains an unfortunate lack of documented information on the potential use of these by-products for their bioactive components, peptides that have various biological and technological properties, and the use of hydrolyzed versions of these by-products as precursors for the production of flavorings.