Nanomaterials have emerged as transformative agents in the textile industry, driving innovations that enhance performance, multifunctionality, and sustainability. The integration of nanoparticles and nanostructures such as nanofibers, nanocomposites, and nanocoatings has enabled the development of advanced textiles with unique properties including antibacterial activity, water repellency, stain and wrinkle resistance, UV protection, flame retardancy, and self-cleaning capabilities. Beyond conventional applications, nanotechnology facilitates smart textiles with biosensing, drug delivery, and energy-harvesting functions, expanding the scope of textiles into healthcare, defense, sports, and wearable electronics. At the same time, eco-friendly approaches, including biodegradable and bio-based nanomaterials, are increasingly being explored to address pressing environmental challenges and support circular economy models in textile production. Despite these opportunities, concerns regarding nanoparticle toxicity, environmental persistence, and occupational safety remain critical, highlighting the importance of stringent regulations and green synthesis strategies. This chapter reviews the historical evolution and current advancements in nanomaterials for textiles, examines synthesis processes and incorporation techniques, and evaluates their functional applications across diverse sectors. Emphasis is placed on balancing innovation with sustainability, by integrating regulatory frameworks and eco-conscious practices. Future perspectives point toward scalable, cost-effective production methods, improved lifecycle management, and the convergence of nanotechnology with digital manufacturing and smart systems. By consolidating recent progress and challenges, this chapter provides a comprehensive overview of nanomaterials in textiles, outlining pathways for developing high-performance, sustainable, and intelligent fabrics that will shape the future of the industry.