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Papaya is one of the most important fruit trees cultivated throughout the tropical and subtropical regions and its production is rising worldwide. Its edible part has a high nutritional and sensory value and a great commercial potential. Mature papaya is consumed fresh and has been used in food processing and cosmetic industries. Along with some other parts such as leaves, seeds or skin, papaya has been used in traditional medicine in various countries. In fact, numerous studies have reported the presence of bioactive compounds with diverse biological properties in the papaya by-products, which has motivated the expansion of their applications. Papaya by-products have been demonstrated to exert a wide range of activities (e.g.; antioxidant, anti-cancer, anti-dengue, anti-malarial, anti-fertility, diabetes prevention, insecticidal, anti-AIDS) that could be useful in pharmaceutical industry. They could be used in food industry, as a source of functional compounds and in innovative active packaging strategies, and in different cosmetic products, among other applications. Although this scenario indicates that the papaya industry could diversify and increase its economic value, there are two problems that significantly affect it: the spread of pathogens and the highly perishable nature of this fruit. On the one hand, genetic tools have been used to obtain transgenic varieties resistant to pathogens, while new preservation technologies have been explored. This review focuses on the main bioactive compounds, important physiological functions and applications of different papaya parts and also in the current development of genetically modified papaya in the industry and the research progress on storage and preservation. [ABSTRACT FROM AUTHOR]