Natural colorants and pigments derived from fungal metabolites have garnered increasing interest in modern years as they possess potential applications in food, textile, and cosmetic industries and have environmental advantages over synthetic alternatives. Fungi, which produce diverse bioactive compounds, have been identified as a reliable source of natural colorants. This chapter explores the various classes of fungal pigments, including carotenoids, melanin, and anthraquinones, and their biosynthetic pathways. It also reviews the ecological roles these pigments play in fungi, such as UV protection and communication. The chapter further highlights recent advancements in the extraction, characterization, and industrial-scale production of these pigments, along with their potential as eco-friendly substitutes for synthetic dyes. Additionally, it discusses the challenges associated with the stability, cost, and scalability of fungal pigment production and the regulatory aspects surrounding their use in commercial applications.