Peptides are important bioactive natural products which are present in many marine species. These marine peptides have high potential nutraceutical and medicinal values because of their broad spectra of bioactivities. Their antimicrobial, antiviral, antitumor, antioxidative, cardioprotective (antihypertensive, antiatherosclerotic and anticoagulant), immunomodulatory, analgesic, anxiolytic anti-diabetic, appetite suppressing and neuroprotective activities have attracted the attention of the pharmaceutical industry, which attempts to design them for use in the treatment or prevention of various diseases. Some marine peptides or their derivatives have high commercial values and had reached the pharmaceutical and nutraceutical markets. A large number of them are already in different phases of the clinical and preclinical pipeline. This review highlights the recent research in marine peptides and the trends and prospects for the future, with special emphasis on nutraceutical and pharmaceutical development into marketed products.