Waste from open‐cage aquaculture flows directly into the marine environment from uneaten feeds, faecal material and dissolved nutrients. Sustainable management outcomes are regularly based on the dispersal patterns of the waste, with biochemical tracing a key tool in understanding the footprint of aquaculture. We examined the use of fatty acid (FA) analysis to trace aquaculture waste for this purpose, with the aim of identifying specific biomarkers for environmental applications, as well as identifying challenges that are regularly encountered. Overall, the widespread use of terrestrial‐based oils in the production of marine aquaculture feeds has increased the use of FA biomarkers to trace aquaculture waste across benthic and pelagic systems, in vertebrates, invertebrates and environmental samples such as sediment and seston. A combination of linoleic acid (LA), oleic acid (OA) and α‐linolenic acid (ALA), which are dominant C18 FA in terrestrial seed and animal oils, is the most commonly used biomarkers, along with overall shifts in FA profile related to diet. A challenge regularly encountered, particularly in lower trophic species, was the capacity of an organism to biomodify or selectively spare certain dietary FA, which can mask assimilation of aquaculture‐derived FA. In these species, controlled feeding studies are needed to properly understand FA metabolism and to ensure correct interpretation of FA data collected from wild samples. Overall, as FA biomarkers have the capacity to link aquaculture waste in the environment with potential effect, they are a valuable and increasingly applied tool for examining the overall influence of aquaculture in marine ecosystems.