Abstract: The cosmetics sector is a multibillion-dollar industry that requires constant attention being paid to innovative product development and engagement. Notably, its market value is projected to be worth over 750 billion U.S. dollars by 2025, and it is expanding as novel, climate-friendly, green, and sustainable components from natural sources are incorporated. This review is written based on the numerous reports on the potential applications of food-derived peptides while focusing on their possible uses in the formulation of cosmeceutical and skincare products. First, the production methods of bioactive peptides linked to cosmeceutical uses are described. Then, we discuss the obtainment and characterization of different anti-inflammatory, antimicrobial, antioxidant, anti-aging, and other pleiotropic peptides with their specific mechanisms, from various food sources. The review concludes with salient considerations of the cost of production and pilot scale operation, stability, compatibility, user safety, site-specificity, and delivery methods, among others, when designing or developing biopeptide-based cosmeceutical products.