Silver nanoparticles (AgNPs) have garnered significant attention due to their unique physicochemical properties and broad-spectrum antimicrobial activity, positioning them as pivotal agents in diverse biomedical and environmental applications. However, conventional AgNPs synthesis methods commonly rely on toxic chemicals and high energy consumption, underscoring a critical need for more sustainable and safe alternatives. In response, green synthesis has emerged as a viable alternative, leveraging biological agents such as plant extracts, bacteria, fungi, and algae to produce AgNPs in an eco-friendly and sustainable manner. This review comprehensively examines the diverse biological approaches to AgNPs synthesis, highlighting the advantages of using natural reducing and stabilizing agents that not only mitigate toxicity but also enhance biocompatibility. Characterization techniques such as TEM, SEM, XRD, and FTIR are essential for ensuring that the NPs meet the required standards for their intended medical applications. Additionally, the cytotoxicity of AgNPs is critically evaluated, with a focus on optimizing size, concentration, and surface modifications to minimize adverse effects while maximizing therapeutic potential. The wide-ranging applications of green-synthesized AgNPs, including antimicrobial, anticancer, catalytic, imaging, and drug delivery systems, underscore their versatility and potential to revolutionize medical technologies. Despite promising advancements, green synthesis still faces challenges in scalability, standardization, and ensuring long-term safety in practical applications. Future research must address these challenges to fully harness the potential of green-synthesized AgNPs in medicine and environmental applications. This review aims to provide an in-depth understanding of the current state of green synthesis and its implications for sustainable nanotechnology.