Monascus purpureus copiously yields beneficial secondary metabolites , including Monascus pigments, which are broadly used as food additives, as a nitrite substitute in meat products, and as a colorant in the food industry. Monascus yellow pigments (monascin and ankaflavin) have shown potential antidiabetic, antibacterial, anti-inflammatory, antidepressant, antibiotic, anticancer, and antiobesity activities. Cosmetic and textile industries are other areas where it has established its potential as a dye. This paper reviews the production methods of Monascus yellow pigments, biosynthesis of Monascus pigments from M. purpureus, factors affecting yellow pigment production during fermentation, and the pharmacological properties of monascin and ankaflavin.