Traditional dyeing methods rely on synthetic dyes and chemicals, which often generate large amounts of toxic waste harmful to flora and fauna. In contrast, natural dyes are biodegradable, non-toxic, and ecologically friendly. The resurgence of natural dyes in the textile industry in recent years is due to growing environmental concerns and a shift towards sustainable practices consistent with the United Nations Sustainable Development Goals (SDGs), particularly SDG 12 (Responsible Consumption and Production) and SDG 6 (Clean Water and Sanitation). Adopting eco-friendly dyeing practices reduces industrial water pollution and promotes sustainable resource use, thereby supporting the global efforts towards a sustainable world. This chapter discusses the innovative advancements in natural dye extraction and application for textile finishing, highlighting their significance in promoting sustainable practices in the textile industry. Techniques such as ultrasound-assisted extraction, enzyme-assisted processes, and supercritical fluid extraction are examined for their efficiency and effectiveness in obtaining vibrant colours from various plant sources. Also, methods of extracting natural dyes from insects and mineral sources are critically examined, focusing on their commercial viability. It also explores the application processes of these dyes in textile finishing, including various mordanting techniques and dyeing methods that enhance colour fastness and aesthetic appeal. Additionally, discusses recent advancements in the extraction and application of natural dyes and how such innovations have overcome traditional limitations, making them viable alternatives to synthetic dyes. Furthermore, the study addresses the standardisation of natural dyeing processes, colour reproducibility, and quality control measures essential for industrial adoption. More so, the safety and regulatory issues with regard to the extraction application of natural dyes are further discussed. This chapter concludes by providing insights into future research directions that promote the development of natural dyes for sustainable industrial processes.