Cashmere, also known as pashmina, is derived from the secondary hair follicles of Cashmere/Changthangi goats. Renowned as the world's most luxurious natural fiber, it holds significant economic value in the textile industry. This comprehensive review enhances our understanding of the complex biological processes governing cashmere/pashmina fiber development and quality, enabling advancements in selective breeding and fiber enhancement strategies. The review specifically examines the molecular determinants influencing fiber development, with an emphasis on keratins (KRTs) and keratin-associated proteins (KRTAPs). It also explores the roles of key molecular pathways, including Wnt, Notch, BMP, NF-kappa B, VEGF, cAMP, PI3K-Akt, ECM, cell adhesion, Hedgehog, MAPK, Ras, JAK-STAT, TGF-β, mTOR, melanogenesis, FoxO, Hippo, and Rap1 signaling. Understanding these intricate molecular cascades provides valuable insights into the mechanisms orchestrating hair follicle growth, further advancing the biology of this coveted natural fiber. Expanding multi-omics approaches will enhance breeding precision and deepen our understanding of molecular pathways influencing cashmere production. Future research should address critical gaps, such as the impact of environmental factors, epigenetic modifications, and functional studies of genetic variants. Collaboration among breeders, researchers, and policymakers is essential for translating genomic advancements into practical applications. Such efforts can promote sustainable practices, conserve biodiversity, and ensure the long-term viability of high-quality cashmere production. Aligning genetic insights with conservation strategies will support the sustainable growth of the cashmere industry while preserving its economic and ecological value.