Papain is a cysteine endopeptidase of vegetal origin (papaya (Carica papaya L.) with diverse applications in food technology. In this review we have focused our attention on its application in the production of bio-peptides by hydrolysis of proteins from fish residues. This way, a residual material, that can become a contaminant if dumped without control, is converted into highly interesting products. The main bioactivity of the produced peptides is their antioxidant activity, followed by their nutritional and functional activities, but peptides with many other bioactivities have been produced. Thera are also examples of production of hydrolysates with several bioactivities. The enzyme may be used alone, or in combination with other enzymes to increase the degree of hydrolysis.