Chitosan is a naturally occurring biopolymer having diversified applications not only in the pharmaceutical field, but also in the biomedical profession. The presence of functional groups, i.e., hydroxyl, acetamido, and amine in the chitosan parent backbone, makes it a suitable candidate for chemical modification, and introduces desired physicochemical and biochemical properties, without any changes in its fundamental skeleton. The various modifications, i.e., alkylation, acylation, quaternization, hydroxyalkylation, carboxyalkylation, thiolation, sulfation, phosphorylation, enzymatic modifications, oligomerization, and graft copolymerization with assorted modifications, and their pharmaceutical and biomedical applications, are discussed in this article. Additionally, it is also limelighted how the chemically engineered chitosan has established a better place with regard to the vista of applications in the arena of sciences such as pharmaceutical, biomedical, biotechnological, tissue engineering, the textile industry, chemistry, the food industry, and many more. This review, hopefully, could enrich knowledge and bring forth new thoughts in line with progress in chitosan polymer science.