The tomato is a member of the Solanaceae family and is a crop that is widely cultivated around the world due to its sweet, sour, salty, juicy, and nutritious berries. The processing of tomatoes generates a significant amount of waste in the form of tomato pomace, which includes seeds and skin. Tomato seeds are reservoirs of various nutrients, such as proteins, carbohydrates, lipids, minerals, and vitamins. These components make tomato seeds an important ingredient for application in food matrices. This review discusses the functional food properties of tomato seeds and their scope of utilization as major ingredients in the functional food industry. In addition, this review describes the development of tomato seeds as a potential nutritional and nutraceutical ingredient, along with recent updates on research conducted worldwide. This is the first review that demonstrates the nutritional profile of tomato seeds along with its diverse functional food properties and application as a functional food ingredient.