Nanolignin is a biomacromolecule nanomaterial obtained from lignin, a natural plant polymer. It has attracted considerable attention as a potential nanofiller for polymer composites owing to its remarkable properties, such as biodegradability, antioxidant activity, and high specific surface area. However, the development of biological macromolecule nano lignin-based polymer composites faces several challenges, mainly due to the complex structure and poor chemical compatibility of lignin with most polymers. A comprehensive summary of the functionalization strategies and synthesis techniques for nanolignin is provided in this article. The morphological, structural, and thermal characterization of nanolignin is also reviewed. Furthermore, this review summarizes the recent progress of nanolignin and its composites prepared using various polymers, such as polyvinyl alcohol, poly (methyl methacrylate), polylactic acid, phenol formaldehyde, and natural rubber. This study concludes by outlining the possible uses of nanolignin-reinforced polymer composites and the potential opportunities and disadvantages of using nanolignin as a reinforcement in polymer composites for several value-added applications.