The vast diversity of plants in nature offers a rich reservoir of bioactive compounds that have historically played an integral role in pharmacotherapy and continue to serve as a primary source of novel therapeutic agents. Medicinal plants contain a multitude of secondary metabolites with pharmacological potential, making them indispensable in drug discovery and development. These bioactive constituents, inherent in herbal remedies, exhibit a wide range of medicinal properties due to their complex chemical compositions and structural diversity. Despite their therapeutic potential, the clinical application of crude plant extracts is often hindered by limitations, such as poor bioavailability, low biostability, and variable efficacy. These issues can diminish the therapeutic impact of plantderived compounds. Nanotechnology presents an innovative approach to addressing these challenges through the development of nanoformulations that enhance the efficacy of bioactive compounds. This review examines both historical and recent studies on the synthesis and characterization of bioactive compounds, focusing on their effectiveness in treating various diseases. Additionally, it addresses the risks associated with the direct use of crude plant extracts in medicine, explores extraction and isolation techniques, and reviews research from the past five years on the development of bioactive compounds, their nanoformulations, and their applications in disease treatment. The review also presents recent clinical trials conducted over the last five years on crude extracts and their nanoformulated counterparts, providing insights into the clinical translation of these natural therapeutics.