Lignocellulosic biomass is a complex biopolymer primarily composed of cellulose, hemicellulose, and lignin. Amongst various lignocellulosic sources, agroresidues are abundant byproducts of agricultural processes and have untapped potential as a source of sustainable raw materials. These agroresidues can be harnessed to produce cellulose nanofibers (CNFs) and cellulose nanocrystals (CNCs), which have remarkable mechanical and barrier properties, making them ideal candidates for various applications in bio-composites, pharmaceutical carriers, and electronic substrates. Cellulose, a major component of biomass, can be broken down into nanodimensional materials; however, the intricate ultrastructure of biomass, characterized by strong lignin layers, limited chemical accessibility of cellulose, and high cellulose crystallinity, presents significant challenges to efficient cellulose extraction. Various approaches like acid hydrolysis, alkali treatment, organosolv, and oxidizing agents are used for the extraction of cellulose from their counterparts. Acid hydrolysis is the most accepted method, but it possesses several limitations, so other types of extraction processes are also discussed in this chapter. Once the extraction is achieved, modifications with different functional groups are performed to enhance the functional properties of CNCs. This chapter summarizes the composition of lignocellulosic biomass, methods employed for the extraction of nanocellulose, and types of modifications carried out to enhance the functionality of cellulose nanoparticles. Additionally, it discusses the application of these cellulose nanoparticles in pollution remediation, biomedicine, electrical, anti-counterfeiting, and the food industry.