Recently, the climate-friendly and sustainable characteristics of natural fibers as a reinforced composite have attracted much attention in applications ranging from textiles to transportation. Furthermore, the thermoplastic polymer matrix composite of natural fibers gives them distinct advantages such as high specific strength, lightweight properties, an abundance of supply, corrosion resistance, feasibility, and flexibility in design. The characteristics of natural fibers particularly enhance both their scope and use case within the automotive sector while boosting the transportation economy. This review aims to expand on the appropriate and widely used natural fibers as a thermoplastic composite for fiber reinforcement. The review covers the various reinforcement types, manufacturing methods, mechanical properties of natural fiber-reinforced composites, and their environmental suitability. Finally, the sectors in which natural fiber-reinforced composites are becoming popular and the future challenges of natural fiber-reinforced composites are summarized.