Industrial waste management is critical to maintaining environmental sustainability. The dairy industry (DI), as one of the major consumers of freshwater, generates substantial whey dairy effluent, which is notably rich in organic matter and thus a significant pollutant. The effluent represents environmental risks due to its high biological and chemical oxygen demands. Today, stringent government regulations, environmental laws, and heightened consumer health awareness are compelling industries to responsibly manage and reuse whey waste. Therefore, this study investigates sustainable solutions for efficiently utilizing DI waste. Employing a systematic review approach, the research reveals that innovative technologies enable the creation of renewable, high‐quality, value‐added food products from dairy byproducts. These innovations offer promising sustainable waste management strategies for the dairy sector, aligning with economic interests. The main objectives of the study deal with, (a) assessing the environmental impact of dairy sector waste, (b) exploring the multifaceted nutritional and health benefits inherent in cheese whey, and (c) investigating diverse biotechnological approaches to fashion value‐added, eco‐friendly dairy whey‐based products for potential integration into various food products, and thus fostering economic sustainability. Finally, the implications of this work span theoretical considerations, practical applications, and outline future research pathways crucial for advancing the sustainable management of dairy waste.