Because of their special biocompatibility, biodegradability, and bioactive qualities, mushroom-based nanomaterials have become a promising new area in the creation of functional foods and medications. These nanomaterials, which are derived from proteins, secondary metabolites, and fungal polysaccharides, have improved bioavailability, targeted administration, and a variety of uses. This chapter examines the most recent developments in the extraction, synthesis, and characterization of nanomaterials produced from mushrooms, highlighting their applications in antioxidant effects, immunomodulation, antibacterial activity, and nutraceutical delivery. We also talk about their possibilities in sustainable food preservation, smart packaging, and tailored treatment. The future of mushroom-based nanotechnology in nutrition and health is thoroughly examined, including issues with scalability, regulatory approval, and long-term safety.