Melatonin (MEL) has recently received ample attention as a potential biostimulator in agriculture. MEL has been considered a feasible and effective approach for improving crop output and resilience to various abiotic factors. The first step of MEL biosynthesis in plants is tryptophan (an amino acid), made de novo via the shikimic acid pathway. The processes involved in MEL biosynthesis and plant regulation are described in this review, providing a foundation for understanding the hormone's numerous physiological actions. The research delves into the intricate relationships between MEL and abiotic stresses, such as exposure to drought, salt, heat, cold, and heavy metals. This review provides an overview of recent research on the potential roles of MEL on seed germination, growth, and development in plants, highlighting its benefits for improving crop yield and quality and mitigating the detrimental effects of several abiotic stresses. It also discusses the current understanding of MEL's role as a biostimulator in agriculture, promoting root development, flowering, fruit ripening, and preventing leaf senescence. Furthermore, it summarizes the interplay of MEL with various phytohormones, including cytokinin (CK), auxin (Aux), ethylene (ETH), gibberellic acid (GA), salicylic acid (SA), abscisic acid (ABA), jasmonic acid (JA), polyamines (PAs), brassinosteroid (BR), and signalling molecules such as NO, H2O2, H2S, and Ca2+. MEL shows synergistic interactions with GA, CK, PAs, JA, SA, and BR while exhibiting synergistic and antagonistic regulation with Aux, ETH, and ABA. Also, this review establishes the framework for developing novel MEL-based strategies to enhance agricultural sustainability in the face of increasingly severe environmental conditions.