Fungi have been used since ancient times in food and beverage-making processes and, more recently, have been harnessed for the production of antibiotics and in processes of relevance to the bioeconomy. Moreover, they are starting to gain attention as a key component of the human microbiome. However, fungi are also responsible for human infections. The incidence of community-acquired and nosocomial fungal infections has increased considerably in recent decades. Antibiotic resistance development, the increasing number of immunodeficiency- and/or immunosuppression-related diseases and limited therapeutic options available are triggering the search for novel alternatives. These new antifungals should be less toxic for the host, with targeted or broader antimicrobial spectra (for diseases of known and unknown etiology, respectively) and modes of actions that limit the potential for the emergence of resistance among pathogenic fungi. Given these criteria, antimicrobial peptides with antifungal properties, i.e., antifungal peptides (AFPs), have emerged as powerful candidates due to their efficacy and high selectivity. In this review, we provide an overview of the bioactivity and classification of AFPs (natural and synthetic) as well as their mode of action and advantages over current antifungal drugs. Additionally, natural, heterologous and synthetic production of AFPs with a view to greater levels of exploitation is discussed. Finally, we evaluate the current and potential applications of these peptides, along with the future challenges relating to antifungal treatments.