Biomaterials have gained immense attention for various diseases due to their unique advantages over chemical drugs regarding cost, ease of production, toxicity, and therapeutic efficacy. However, these materials need an inert delivery system that locally delivers cells and minimally elicits foreign body response (FBR). In this aspect, various immunomodulatory biomaterials, including silk, collagen, fibrin, hyaluronic acid, and alginate-based biomaterials, have great potential due to large natural sources, ease of extraction, low cost, chemical inertness, facile surface functionalization, long-term polymeric stability, high biocompatibility, and fine tunability of biomaterials sizes and shapes. In this review article, the recent advancements in the biomedical applications of immunomodulatory biomaterials in different diseases, including diabetes, cancer, cardiovascular disease, bone regeneration, etc, are highlighted. Moreover, the FBR on immunomodulatory biomaterials is discussed and the current and future strategies for the potential mitigation of considerable immune responses toward immunomodulatory biomaterials and devices are highlighted.Recently, with development in cell therapies, stem cell biology, biomaterials, and advanced fabrication techniques, there has been a surge in the use of biomaterials in many healthcare