This is a state-of-the-art review on essential aspects, types, and applications of polyacrylonitrile-based nanocomposite fibers. Polyacrylonitrile is a commercially important acrylic polymer having superior chemical, electrical, mechanical, and thermal properties. Polyacrylonitrile fibers also possess significant scientific worth. Incorporating nanofillers (graphene, graphene oxide, carbon nanotube, metal nanoparticle) in polyacrylonitrile fibers has significantly improved the physical properties of nanocomposite fibers. The polyacrylonitrile/carbon nanotube, polyacrylonitrile/graphene, and polyacrylonitrile/inorganic nanoparticle nanocomposite fiber enhanced characteristics have been attributed to the nitrile groups interfacial bonding with the nanofiller employed. The chemical architecture, superhydrophobicity, superoleophobicity, porosity, absorption capacity, and wettability of nanofibers have led to several advantageous nanocomposite fiber applications. Energy production and storage devices, sensors, electromagnetic interference shielding materials, metal ion detoxification, and antimicrobial relevance are frequently explored areas with the polyacrylonitrile/nanoparticle nanocomposite fibers. Major challenges for nanocomposite fibers are to achieve scalable fabrication, low cost, high selectivity, excellent recyclability, and high absorption capacity. In the future, these nanocomposite fibers need extensive research effort to advance the technology and to bring them to commercialization.