Chitosanases are glycoside hydrolases (GHs) that catalyze the endo- or exo-type cleavage of β-1,4-glycosidic linkages in chitosan, enabling the selective production of chitooligosaccharides (COSs) with well-defined structures and diverse bioactivities. Owing to their substrate specificity and environmentally friendly catalytic action, chitosanases have garnered increasing attention as sustainable biocatalysts for COS production, with broad application potential in agriculture, food, medicine, and cosmetics. This review provides a comprehensive overview of recent advances in chitosanase research, focusing on the catalytic mechanisms and structure–function relationships that govern substrate selectivity and functional divergence across different GH families. Microbial diversity and heterologous expression systems for chitosanase production are discussed in parallel with biochemical characterization to support the rational selection of enzymes for specific biotechnological applications. Advances in protein engineering and computational approaches are highlighted as strategies to improve catalytic efficiency, substrate range, and stability. In addition, bioprocess optimization is addressed, with emphasis on fermentation using low-cost substrates and the application of immobilized enzymes and nano-biocatalyst systems for green and efficient COS production. Summarizing and discussing previous findings are essential to support future research and facilitate the development of next-generation chitosanases for sustainable industrial use.