Alfalfa (Medicago sativa) is increasingly recognized as a versatile and nutrient-dense resource in modern food systems, offering a wide array of health benefits and applications. This review explores the nutritional and functional potential of alfalfa, focusing on its macronutrients (proteins, fibers, amino acids), micronutrients (vitamins A, C, K, and minerals such as calcium and magnesium), and bioactive compounds (saponins, flavonoids, and antioxidants). The applications of alfalfa span from sprouts, extracts, and powders to its incorporation in processed foods like energy bars, protein shakes, and dietary supplements. Innovative germination and extraction technologies have further enhanced its usability, bioactivity, and shelf life. Alfalfa's health benefits, including its antioxidants, anti-inflammatory, cholesterol-lowering, and blood sugar-regulating properties, are highlighted alongside its potential to combat chronic diseases and oxidative stress. The review also identifies challenges, such as improving consumer acceptance and addressing sensory limitations, while spotlighting opportunities in personalized and functional nutrition markets. Emerging research areas, including optimizing agronomic practices, validating health claims through clinical studies, and assessing sustainability metrics, are discussed. This review distinguishes itself from prior studies by providing a comparative analysis of existing literature, identifying research gaps in bioavailability, processing innovations, and regulatory frameworks, and offering forward-looking perspectives on alfalfa's integration into sustainable and health-driven food systems.