The integration of sustainable practices in textile production has become important in the pursuit for eco-friendly solutions in the industry. This chapter explores in situ nanofinishing techniques for natural fiber-based textiles, focusing on enhancing their performance and functionality while minimizing environmental impact. In situ nanofinishing involves the synthesis and deposition of nanomaterials directly onto textile substrates during processing, offering advantages such as reduced chemical usage, energy efficiency, and waste minimization. Various in situ nanofinishing approaches for natural fibers like cotton, wool, jute, and hemp, highlighting their potential to impart properties such as antimicrobial activity, UV protection, water repellency, and enhanced durability are discussed in this chapter. Though nanosilver is widely explored for application in textiles, other nanomaterials like copper, iron oxide, zinc oxide, titania, chitosan, triclosan are also being explored for diverse functionalities. The role of biodegradable and green nanomaterials in achieving these finishes is discussed, emphasizing the alignment of this technology with sustainable development goals. Additionally, case studies are presented to demonstrate the effectiveness of in situ nanofinishing in maintaining the inherent qualities of natural fiber while adding value through functional enhancements. This chapter also addresses the scalability and commercialization potential of this technology, along with its challenges, including cost factors and regulatory considerations.