Plant-sourced Dietary Fibers (PDFs) have garnered significant attention due to their multifaceted health benefits, particularly in glycemic control, lipid metabolism regulation, and gut microbiota modulation. This review systematically investigates advanced modification strategies, including physical, chemical, bioengineering, and hybrid approaches, to improve the physicochemical properties and bioactivity of PDFs from legumes, cereals, and other sources. Key modifications such as steam explosion, enzymatic hydrolysis, and carboxymethylation significantly improve solubility, porosity, and functional group exposure, thereby optimizing the health-promoting effects of legume-sourced dietary fiber. The review further elucidates critical structure-function relationships, highlighting PDF's prebiotic potential, synergistic interactions with polyphenols and proteins, and responsive designs for targeted nutrient delivery. In functional food applications, cereal-sourced dietary fibers serve as a versatile functional ingredient in engineered foods including 3D-printed gels and low-glycemic energy bars, addressing specific metabolic disorders and personalized dietary requirements. By integrating state-of-the-art modification techniques with innovative applications, this review provides comprehensive insights into PDF's transformative role in advancing functional foods and personalized nutrition solutions.