<p>In the global context, the production of agricultural commodities, particularly fruits and vegetables, has increased significantly due to rising demand and population growth. However, a significant amount of waste is generated every day in the food and beverage industry due to post-harvest losses and incomplete product utilization. The use of fruit and vegetable waste or by-products as sources of dietary fiber for various food applications is an emerging trend in the modern food industry, primarily driven by their health benefits. This approach enhances the overall quality of the products while increasing their dietary fiber, total phenolic content, and antioxidant properties. The current review explores recent studies on the potential applications of fruit and vegetable by-products as sources of dietary fiber in processed meat, dairy, bakery, snack, pasta, and beverage products, while investigating their effects on physico-chemical and functional properties, sensory attributes, and shelf life. Additionally, the review underlines various challenges and future directions related to the use of dietary fiber sources in food and beverage applications.</p>