Cotton (Gossypium spp.), commonly known as the "King of Fibers," plays a crucial role in the global textile industry because of its comfort, breathability, and biodegradability. However, their high flammability presents significant safety risks, particularly in fire-prone environments, leading to an urgent demand for effective flame retardants. In addition to flammability concerns, the lack of inherent antibacterial properties of cotton makes it susceptible to microbial growth, resulting in odors and fabric degradation. This issue has been exacerbated by the COVID-19 pandemic, which has heightened public awareness of hygiene and the necessity for textiles that minimize microbial contamination. Consequently, there has been a surge in the need for antibacterial treatments of cotton textiles, focusing on solutions that are both effective and environmentally friendly. Despite this increasing focus, numerous reviews have examined flame-retardant and antibacterial finishing solutions separately. However, a comprehensive analysis that integrates both functionalities has not yet been systematically compiled. This review aims to fill this critical gap by consolidating the existing literature on eco-friendly solutions for cotton textiles, specifically focusing on flame-retardant, antibacterial, and dual-functional treatments. It evaluates the current state of eco-friendly flame retardants, assesses the effectiveness of various natural antibacterial agents, and explores innovative synergistic formulations designed to enhance both flame resistance and antibacterial performance. This review also identifies future directions for the development of multifunctional textiles that meet the evolving demands of consumers and align with regulatory standards, ultimately contributing to safer and more sustainable textile solutions.