Chitosan, derived from marine resources and insects, is biodegradable, non-toxic, and chemically tunable, which makes it a good candidate in green technology. Recent improvements in chitosan composites indicate their potential for wastewater treatment, including the removal of heavy metals, dyes, and pesticides through adsorption and photodegradation, as well as for improving soil quality and minimizing pollution. In the energy area, high conductivity and stability of carbon materials derived from chitosan have been used as the electrode and the electrolyte materials in supercapacitors for constructing a low-carbon energy storage device. In biomedicine, owing to chitosan's biocompatibility, antimicrobial, and modifiable surface chemistry properties, it has already been employed in wound dressings, drug delivery, as well as tissue engineering. This review elucidates the growing potential of functional chitosan-derived composites for environmental, energy, and biomedical applications. Key Scientific Concepts of Review: Nevertheless, cost-effective mass production on large scales while maintaining mechanical stability in acidic environment devices and ensuring structural uniformity for the batch is still challenging. Subsequent research needs to incorporate green extraction technologies involving ionic and deep eutectic solvents, nanoengineering high-surface-area composites, and new strategies of functionalization without any crosslinker. Interfacing computational modeling with advanced manufacturing technologies such as three-dimensional (3D) printing could expedite the development of smart, responsive, and recyclable chitosan systems. All in all, the chitosan-composite area is considered a hotspot of biotechnology and material science and has great potential for realizing circular bioeconomy targets as well as sustainable goods for dealing with environmental pollution, energy, and biomedical improvement.