Keratin-rich by-products, i.e. bristles, horns and hooves, chicken feathers and similar, are a source of nutrients for animals (amino acids) and plants (N, S). Contemporary developments in the management of keratin waste in feeds and fertilizers comply with human and animal health protection regulations and respect the principles of ecological development. Biotechnological methods employing keratinolytic bacteria and microscopic fungi play a key role in processing keratin waste. This study reviews the current knowledge on the ecology and physiology of keratinolytic microorganisms and presents the biodegradation mechanism of native keratin. The structure and chemical composition of keratin proteins are described, and methods of keratin waste biotransformation into products of practical industrial and natural value, especially composts, are discussed.