The multiple functions of peptides released from proteins have immense potential in food and health. In the past few decades, research interest in bioactive peptides of plant origin has surged tremendously, and new plant-derived peptides are continually discovered with advances in extraction, purification, and characterization technology. Plant-derived peptides are mainly extracted from dicot plants possessing bioactive functions, including antioxidant, cholesterol-lowering, and antihypertensive activities. Although the distinct functions are said to depend on the composition and structure of amino acids, the practical or industrial application of plant-derived peptides with bioactive features is still a long way off. In summary, the present review mainly focuses on the state-of-the-art extraction, separation, and analytical techniques, functional properties, mechanism of action, and clinical study of plant-derived peptides. Special emphasis has been placed on the necessity of more pre-clinical and clinical trials to authenticate the health claims of plant-derived peptides.