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Bioactive compounds refer to secondary metabolites extracted from plants, fungi, microbes, or animals. Besides having pharmacological or toxicological effects on organisms leading to utilization in food and pharmaceutical industries, the discovery of novel properties of such compounds has led to the diversification of their applications, ranging from cosmetics and functionalized biomaterials to bioremediation and alternate fuels. Conventional time-consuming and solvent-intensive methods of extraction are increasingly being replaced by green solvents such as ionic liquids, supercritical fluids, and deep eutectic solvents, as well as non-conventional methods of extraction assisted by microwaves, pulse electric fields, enzymes, ultrasound, or pressure. These methods, along with advances in characterization and optimization strategies, have boosted the commercial viability of extraction especially from agrowastes and organic residues, promoting a sustainable circular economy. Further development of microfluidics, optimization models, nanoencapsulation, and metabolic engineering are expected to overcome certain limitations that restrict the growth of this field, in the context of improving screening, extraction, and economy of processes, as well as retaining biodiversity and enhancing the stability and functionality of such compounds. This review is a compilation of the various extraction and characterization methods employed for bioactive compounds and covers major applications in food, pharmacy, chemicals, energy, and bioremediation. Major limitations and scope of improvement are also discussed. Graphical abstract

A critical look at challenges and future scopes of bioactive compounds and their incorporations in the food, energy, and pharmaceutical sector