The textile industry generates large amounts of cotton waste, which poses an environmental problem regarding disposal. This study aimed to extract cellulose nanocrystals (CNCs) from cotton waste for application as a reinforcing agent in alginate (ALG) monofilaments produced by wet spinning. The impact of the type of waste (bleached or dyed) and CNCs content (1%, 3%, 5%, 10%, and 20%) on the properties of nanocomposite filaments was examined. Results showed that rod‐like shape CNCs, stable suspensions, and high yields (> 80%) were obtained from both wastes. The presence of dye did not affect the thermal behavior or the crystallinity index (CrI) of the CNCs, which was 87%. Analysis of the morphology revealed that the addition of CNCs increased the irregularities of the filaments' microstructure. Filaments with dyed CNCs presented better mechanical properties than those from bleached waste, with optimal results at 5% CNCs. At this content, the tensile strength reached 166.7 MPa, and Young's modulus was 6.04 GPa, representing an increase of over 400% compared to pure ALG filament. In conclusion, this study suggests that intrinsically colored and resistant ALG–CNC filaments can be developed from cotton waste without needing pre‐treatment, contributing to the textile sector's sustainability.