Polysaccharides are complex carbohydrates that can be derived from plants, algae, fungus, and bacteria abundantly in nature as they possess multifunctional properties making them suitable for a wide range of uses. These properties include biocompatibility, biodegradability, and gel-forming and film-forming capabilities of polysaccharide like cellulose, starch, chitosan, and alginate that make the polysaccharides highly favorable for formulation of new materials and products. Biomedical uses of polysaccharides comprise of drug delivery systems, tissue engineering, and wound healing because polysaccharides exhibit features of selective drug release, biocompatibility with living tissues, and cell stimulation. In addition, owing to the antioxidant, antibacterial, and anti-inflammatory properties of their constituents, the compounds may also act as therapeutic entities. Polysaccharides are used to a very large extent in food processing-seasoning, thickening agents, stabilizers, and emulsifiers, extending the shelf life of food products and improving their texture. Moreover, the roles of prebiotics, which they regularly confer on gastrointestinal tract, make them included in the list of functional ingredients for meals targeting overall health and well-being. This chapter focuses on the characteristics, biological effects, and applications of the naturally occurring polysaccharides with reference to the growing interest in biomedical engineering, pharmacology and nutritional science. Furthermore, this chapter covers challenges of isolating, refining, and transforming natural polysaccharides so that it is possible to improve their functional properties for specific applications. Solutions for enhancing solubility, mechanical properties, and bioactivity properties of these biopolymers are discussed, and the information sources on the green approach to fabrication of these materials are described. The potential of application of polysaccharides in many fields owing to their versatile properties and their renewability make them some of the most promising materials that shall pave way for sustainable and innovative ideas in the future.