Nanotechnology research is at the leading edge of technology, due to its many applications. The biosynthesis of nanoparticles is very important because of their lower toxicity. In comparison to other biological systems utilized for synthesis, fungi are a better biogenic agent because of their broad diversity, simple culture techniques, superior growth control, efficiency in terms of both time and money, and environmentally safe approach to creating nanoparticles. Both extracellularly and intracellularly, fungi are capable of producing nanoparticles. Mycosynthesized nanoparticles are used extensively in a variety of fields, including disease detection and control, wound healing, food preservation, textile fabrication, and many more. The current review discusses fungi’s potential as nano-factories, their production process, characterization, and uses for nanoparticles. To produce nanoparticles with better composition, size, shape, and monodispersity, the future of myco-nanotechnology lies in the optimization of biological operations. In the near future, particle characteristics may be improved via genetic engineering techniques.