Since ancient times, herbs have been used as natural remedies for curing many physiological disorders. Traditional medicinal literature appreciated their value as nature's gift to mankind for the healing of illnesses. Some of the herbs have also been used for culinary purposes, and few of them have been used in cheese manufacture both as coagulating agents and flavor ingredients. Scientific investigations regarding biological activity and toxicity of chemical moieties present in many herbs have been carried out over a period of time. Consequently, literature related to the use of herbs or their functional ingredients in foods and their interaction with food constituents has been appearing in recent times. This article presents the information regarding some biologically active constituents occurring in commonly used herbs, viz., alkaloids, anthraquinones, bitters, flavonoids, saponins, tannins, and essential oils, their physiological functionalities, and also the description of few herbs of importance, viz., Asparagus racemosus, Withania somnifera, Bacopa monniera, Pueraria tuberose, Emblica officinalis, Terminalia chebula, Terminalia belerica, Terminalia arjuna, and Aloe vera, in terms of their chemical composition, biological functionality, and toxicity. This article also reviews the use of herbs and their active ingredients in foods and their interactions with different food constituents.