Bacteriophages encode many distinct proteins for the successful infection of a bacterial host. Each protein plays a specific role in the phage replication cycle, from host recognition, through takeover of the host machinery, and up to cell lysis for progeny release. As the roles of these proteins are being revealed, more biotechnological applications can be anticipated. Phage-encoded proteins are now being explored for the control, detection, and typing of bacteria; as vehicles for drug delivery; and for vaccine development. In this review, we discuss how engineering approaches can be used to improve the natural properties of these proteins and set forth the most innovative applications that demonstrate the unlimited biotechnological potential held by phage-encoded proteins.