Mushrooms are valuable sources of nutraceuticals and functional food ingredients, containing bioactive compounds such as ?-glucans, phenolics, terpenoids, sterols and ergothioneine. Species including shiitake, oyster mushroom, reishi, lion?s mane and Cordyceps militaris have shown promising nutritional, antioxidant, immunomodulatory and gut-health-related potential. However, much of the available evidence is based on laboratory and animal studies, emphasizing the need for well-designed human clinical trials. The nutraceutical potential of mushrooms is influenced by species, cultivation, processing, extraction and formulation, making standardization and quality control essential. Advances in mushroom biotechnology, sustainable cultivation and precision fermentation are creating opportunities for producing high-value bioactive compounds while utilizing agricultural residues. Overall, mushroom nutraceuticals offer promising prospects at the intersection of mycology, nutrition, biotechnology and sustainable food production.