Functional nanoengineering of nanofibrous materials is getting more important day by day due to an increased demand for smart nanomaterials in many industrial technologies. A simple synthesis and extraordinary features, e.g., high specific surface area, multi‐dimensional structure, small pores, self‐adjustment, flexibility, elasticity, etc., open a wide application range for smart nanofibers as important components in daily‐life appliances. These nanofibrous materials can potentially revolutionize medical, agriculture, food, energy, water, and wastewater treatment technologies due to their capacity to detect small changes (ppm and ppb levels) and simultaneously react to the involved environmental stimuli. In this work, a detailed overview of smart nanofibers in terms of their functionalities, fabrication strategies, and technological applications relevant to fulfilling society's sustainable development goals (SDGs) is provided. Various techniques for functionalizing the nanofibers are covered, along with their unique characteristics, which strengthen the portfolio of properties and thus new applications. Finally, the important usage of nanofibers in the environmental and human healthcare fields is briefly discussed, along with the potential applications in other future technologies. This work demonstrates the challenges and possibilities for smart nanofibers and their applications while simultaneously addressing a new era of multidisciplinary research toward the creation and new uses of smart nanofibers.