In locations where the agricultural conditions are so poor that most cereals either do not grow at all or produce very little, millets are one of the major crops farmed for food and fodder. They are rich sources of vitamins, minerals, unsaturated fatty acids, protein, dietary fiber, and bioactive phytochemicals. Millets are an excellent source of phytochemicals with antimicrobial, antioxidant, anticancer, and antimutagenic qualities. Millets contain certain antinutritional elements; however, they may be eliminated using various processing techniques, including soaking and germination. Since more people are becoming aware of functional foods, millets have become more significant because of their polyphenols, gluten-free status, certain minerals, and high dietary fiber content. They also contain antioxidant, antibacterial, and anti-tumorigenic properties. Through the development of novel food products, millets are utilized to formulate functional foods, highlighting their significance in illness prevention and health promotion. Owing to the versatility and nutrition profile of millets, emerging sectors of nutraceuticals and specialty foods are also being explored for the utilization of millets, discussing millet-derived supplements and their mechanisms of action in supporting human health. This review focuses on the utilization of millets in the development of health-oriented food systems and the associated challenges.