Human milk is universally recognized as the optimal and most natural source of nutrition for newborns, offering benefits that extend far beyond basic energy and macronutrient provision. Among its complex constituents, human milk oligosaccharides (HMOs) represent the third most abundant solid component, surpassed only by lactose and lipids. HMOs are distinguished by their exceptionally high structural diversity—over 200 distinct structures have been identified to date. This structural complexity underlies the extensive biological functions HMOs perform within the infant’s body. HMOs play a pivotal role in promoting healthy growth, development, and overall well-being in infants and young children, functioning as indispensable bioactive molecules. Their key physiological activities include: immunomodulation and allergy prevention by promoting immune tolerance and reducing the risk of allergic diseases; potent anti-inflammatory and antioxidant effects that protect vulnerable infant tissues; support for brain development and cognitive enhancement through multiple mechanisms; anti-pathogenic properties, acting as soluble receptor analogs or “decoy” molecules to competitively block viral, bacterial, and other pathogen adhesion, thereby preventing colonization and infection in the gastrointestinal tract; and functioning as blood group substances. At the translational and application level, HMO research is actively driving cross-disciplinary innovation. Building on a deep understanding of their immunological and neurodevelopmental benefits, certain structurally defined HMOs have been successfully incorporated into infant formula. These HMO-supplemented formulas have received regulatory approval and are now commercially available worldwide, providing a nutritional alternative that more closely resembles human milk for infants who are not exclusively breastfed. This represents a significant step toward narrowing the compositional gap between formula and breast milk. Simultaneously, research into the symbiotic relationship between HMOs and the gut microbiota—particularly their role as selective prebiotic substrates promoting the growth of beneficial bacteria—has catalyzed the development of novel functional foods, dietary supplements, and microbiome-targeted therapies. These include advanced synbiotic formulations that combine specific probiotic strains with HMOs to synergistically optimize gut health and function. Furthermore, the intrinsic qualities of HMOs—including their natural origin, safety profile, biocompatibility, and proven antioxidant properties—have attracted growing interest in the emerging field of high-performance cosmetics. They are increasingly being explored as innovative functional ingredients in skincare products aimed at reducing oxidative stress and supporting skin health. This review aims to systematically synthesize recent advancements in HMO research, offering a comprehensive analysis centered on their complex composition and structural diversity; the molecular and cellular mechanisms underlying their diverse biological functions; their translational potential across sectors such as nutrition, medicine, and consumer care (including cosmetics); and the major challenges that persist in the field. It critically examines both foundational discoveries and recent breakthroughs. By integrating these interconnected themes, the review provides a holistic and up-to-date perspective on the scientific landscape of HMOs, highlighting their essential role in early-life nutrition and their expanding relevance across health and wellness applications. It also outlines promising directions for future research, with the goal of advancing evidence-based innovation in infant health and beyond.