This chapter provides a concise overview of the surface functionalization and nano-finishing processes applied to textiles. The surface properties of a material are modified to improve functionality, without affecting its bulk characteristics, a process known as surface modification. It can be achieved by different approaches such as chemical, physical and biological methods. Chemical methods proposed a wide variety of reagents for fabric surface modification; however, they require rigorous control and involve the use of many hazardous chemicals. In contrast, biological methods are environmentally friendly and do not cause hazardous waste, but they require significantly more time and patience to yield optimal results. Thus, among many surface modification procedures, the physical method is the most exact and convenient because it does not require any dangerous chemicals and takes less time than the other ways. This chapter provides a brief overview of the classification, synthesis, and applications of nanoparticles and it gives a synergetic approach of surface modification and nano-finishing in textile industry. Growing awareness of health and hygiene has increased the demand of bioactive, antibacterial and UV-protected textiles. Nanotechnology has real marketable potential for the textile industry because conventional methods have no permanent effects and lose their functions after washing. On the other hand, treating textiles with nanomaterials is a method to improve their properties, which makes them more durable, anti-static, anti-odour etc.