The development of commercially viable “green products” based on natural resources for both matrices and reinforcements for a wide range of applications is on the rise. This effort includes new pathways to produce natural polymers with better mechanical properties and thermal stability using nanotechnology and use of natural polymers to make biodegradable plastics and their composites with lignocellulosic fibers. This paper presents an overview of the developments made in the area of biodegradable composites, in terms of market, processing methods, matrix–reinforcement systems, morphology, properties and product development. Some critical issues and suggestions for future work are discussed, underscoring the roles of materials scientists and textile engineers for the future of these new “green” materials through value addition to enhance their use.