<p>Fruit processing generates substantial by-products like peels, pomace, seeds, and pulp. The improper management of this by-products poses significant environmental and economic challenges. At the same time, numerous scientific studies have demonstrated that these by-products are a noteworthy source of bioactive compounds, including dietary fibers and phenolic compounds, with potential applications in the food and nutraceutical sectors. From a circular economy perspective, this review explores the conversion of Mediterranean agro-industrial residues into functional flours. By focusing on by-products such as citrus peels, vinification residues, olive oil, pomegranate, prickly pear, and carob processing streams, we assess their potential for use in confectionery and baked goods (e.g., bread, biscuits, muffins, cakes, and panettone). These food matrices, despite being widely consumed worldwide, are often characterized by a high content of rapidly digestible carbohydrates and a lack of fiber and micronutrients. Supplementation with agro-industrial by-products could represent an effective strategy, not only to increase the nutritional and functional profile of final products, but also to improve their techno-functional, sensorial, and, in some cases, antimicrobial properties. Specifically, the goal is to promote the development of high-value health foods, both wheat-based and gluten-free, in line with the sustainability and innovation needs of the food sector.</p>