With the advancement of high-throughput technologies, the pivotal role of non-coding RNA (ncRNA) as a master regulator of various biological functions has become increasingly apparent. Historically considered non-functional and labeled as "junk DNA," pseudogenes can be transcribed into RNA, indicating a potential role similar to ncRNAs. Recent research suggests that some pseudogenes can encode functional peptides or proteins. A growing body of evidence has revealed that pseudogenes and their derived functional molecules are involved in various biological processes and can serve as prognostic markers in cancers. This review comprehensively summarizes and discusses the current understanding of the functional roles of pseudogenes and their derived molecules in biological functions.