The modification of textiles by the incorporation of nanofillers to incorporate multifunctional properties is emerging as an active area of research. The use of lignin, a biowaste material in textiles to create properties like UV blocking, flame retardancy, antimicrobial properties, etc. paves the way toward creating sustainable textiles with an additional advantage of utilizing a biowaste into a value-added product. The futuristic tailoring of lignin chemistry through functionalization is an entrancing field of research. It incorporates the inherent properties of lignin with the extraneous characteristics of attached matrix polymers. Such modifications aid to enhance the miscibility of lignin with various polymeric matrices, which help to magnify the capabilities of lignin/polymer composites. The review throws light on how lignin can be explored to tailor the properties of textiles in an effective manner. The UV blocking efficiency, flame retardancy as well as antimicrobial properties imparted to textiles by the presence of lignin are discussed in detail. An outlook on the durability and comfort of lignin incorporated textiles is also discussed. An effort is also taken to compare lignin with other commonly used fillers in textile materials. All the available data on lignin-based textiles are consolidated in a comprehensive manner in this review.