Xylanases are hydrolytic enzymes with immense industrial potential; extensively used for industry such as pulp and paper, biofuels, textiles, food processing, and animal feed. Despite their recognized environmental and economic benefits, the widespread industrial application of xylanases remains limited by several significant challenges. This chapter provides a comprehensive exploration of the critical barriers to industrial xylanase utilization, including enzyme stability under extreme processing conditions, high production costs, substrate specificity limitations, and product inhibition. It also addresses the complexities of integrating xylanases into established industrial workflows and the environmental concerns associated with enzyme production and usage. Emerging strategies, such as advanced protein engineering, synthetic biology, and digital process optimization, are examined. As promising solutions to these problems, by presenting a more in-depth picture current limitation and highlighting innovative technological and scientific progress, this chapter intends to give a guideline for improving commercial viability and sustainability of xylanase-based industrial processes.