Synthetic pigments from petrochemicals have been extensively used in a wide range of food products. However, these pigments have adverse effects on human health that has rendered it obligatory to the scientific community in order to explore for much safer, natural, and eco-friendly pigments. In this regard, exploiting the potential of agri-food wastes presumes importance, extracted mainly by employing green processing and extraction technologies. Of late, pigments market size is growing rapidly owing to their extensive uses. Hence, there is a need for sustainable production of pigments from renewable bioresources. Valorization of vegetal wastes (fruits and vegetables) and their by-products (e.g. peels, seeds or pomace) can meet the demands of natural pigment production at the industrial levels for potential food, pharmaceuticals, and cosmeceuticals applications. These wastes/by-products are a rich source of natural pigments such as: anthocyanins, betalains, carotenoids, and chlorophylls. It is envisaged that these natural pigments can contribute significantly to the development of functional foods as well as impart rich biotherapeutic potential. With a sustainability approach, we have critically reviewed vital research information and developments made on natural pigments from vegetal wastes, greener extraction and processing technologies, encapsulation techniques and potential bioactivities. Designed with an eco-friendly approach, it is expected that this review will benefit not only the concerned industries but also be of use to health-conscious consumers.