Natural polymers are very widespread in the world, which is why it is so important to know about the possibilities of their use. Chitin is the second most abundant reproducible natural polymer in nature; however, it is insoluble in water and basic solvents. Chitin is an unused waste of the food industry, for which there are possibilities of secondary management. The research led to obtaining a soluble, environmentally friendly form of chitin, which has found potential applications in the many fields, e.g., medicine, cosmetics, food and textile industries, agriculture, etc. The deacetylated form of chitin, which is chitosan, has a number of beneficial properties and wide possibilities of modification. Modification possibilities mean that we can obtain chitosan with the desired functional properties, facilitating, for example, the processing of this polymer and expanding the possibilities of its application, also as biomimetic materials. The review contains a rich description of the possibilities of modifying chitin and chitosan and the main directions of their application, and life cycle assessment (LCA)—from the source of the polymer through production materials to various applications with the reduction of waste.