Rambutan (Nephelium lappaceum L.), a tropical fruit native to Southeast Asia, presents significant potential across nutritional, medicinal and industrial domains. This review consolidates current research on the valorisation of Rambutan by-products, particularly seeds and peels-highlighting their rich bioactive compound composition, including flavonoids, tannins, geraniin and epigallocatechin gallate, a potent anti-cancerous compound. These constituents exhibit potent antioxidant, antidiabetic, antihypercholesterolemic and antimicrobial activities. Physicochemical analyses of rambutan seed oil from varieties R4, R7 and Serjan reveal favourable thermal and compositional profiles, including high levels of arachidic and oleic acids, positioning it as a viable alternative to cocoa butter. Processing techniques such as fermentation and roasting enhance the oil’s sensory and nutritional attributes, while toxicity assessments confirm its safety for consumption. Despite promising findings, gaps remain in mechanistic understanding, clinical validation and industrial scalability. Future research should focus on molecular pharmacology, compound isolation and integration into circular-economy models to fully harness the potential of Rambutan by-products for sustainable food systems and functional applications.