Owing to economic and environmental benefits, new generations of materials/commodities follow “from waste to wealth” strategy. Recently, there has been a huge upsurge in research on the development of eco‐composites using recycled plastic polymers and agro‐residues because the eco‐composites satisfy the stringent environment regulations and are cost‐effective. Herein, we present a detailed review on the potential use of several types of natural fillers as an efficient reinforcement for recycled plastic polymers. In particular, the characterization of different categories of eco‐composites according to their morphological, physical, thermal, and mechanical properties is extensively reviewed and their results are analyzed, compared, and highlighted. Furthermore, a framework to produce functional eco‐composites, which includes functionalization of ingredients, critical issues on microstructural parameters, processing, and fabrication methods, is outlined and supported with sufficient data from the literature. Finally, the review outlines the emerging challenges and future prospects of eco‐composites to be addressed by interested researchers to bridge the gap between research and commercialization of such a class of material. Overall, the acquired knowledge will guide researchers, scientists, and manufacturers to plan, select, and develop various forms of eco‐composites with enhanced properties and optimized production processes.