By-products originating from agricultural and food processing are considerable disposal problem for the industry because these waste streams emerge in huge quantities and often have direct impact on the economy and environmental pollution. However, at the same time, it constitute a rich but yet underutilized source of valuable components, which may find application as ingredients in the food and non-food industries. As a result, numerous projects are currently directed toward the utilization of agricultural and food processing by-products such as animal-based (skin, bone, flesh, and internal organs) and plant-based biomaterials (fruit peels and seeds, rice bran, and etc.). In the present work, we would like to focus on the potentialities and the current research of the compounds and extracts deriving from agro-industrial disposable wastes in the food-related utilization. The potential of selected by-products as a source of bioactive/functional compounds in terms of emerging and conventional techniques for extraction, characterization, biological activity monitoring and application of the extracts or isolated compounds as functional food ingredients or bio-based materials for food packaging are highlighted. Considering environmental effect and economic loss, agricultural and food processing by-products should be utilized in various innovative processes in the cause of beneficial product derivation.