Lipases are water-soluble enzymes that act on insoluble substrates and catalyze the hydrolysis of long-chain triglycerides. Lipases play a vital role in the food, detergent, chemical, and pharmaceutical industries. In the past, fungal lipases gained significant attention in the industries due to their substrate specificity and stability under varied chemical and physical conditions. Fungal enzymes are extracellular in nature, and they can be extracted easily, which significantly reduces the cost and makes this source preferable over bacteria. Soil contaminated with spillage from the products of oil and dairy harbors fungal species, which have the potential to secrete lipases to degrade fats and oils. Herein, the strategies involved in the characterization of fungal lipases, capable of degrading fatty substances, are narrated with a focus on further applications.