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Entomogenous fungi (EF) are ubiquitous in nature and have demonstrated significant potential for biological pest control and the regulation of ecosystem functions. In recent years, significant progress has been made in research on the role and function of EF in ecosystems. They play a vital role in regulating agricultural pest populations, promoting plant growth, and maintaining ecological balance. This article provides a comprehensive review of the role and significance of EF within ecosystems. Firstly, the biodiversity of EF and the factors affecting the diversity of EF were summarized. The article then systematically examines the intricate interactions between EF and both animals and plants. By taking advantage of the characteristics of EF, they can not only be used for biological pest control but also colonize plants, promote plant growth, and suppress agricultural pests. Additionally, this review explores the ecosystem services provided by EF, including their participation in mycorrhizal networks and their contribution to the nitrogen cycle in soil. In conclusion, this review highlights the immense potential of EF in pest management and ecosystem function regulation, underscores the importance of ecosystem services, and identifies future scientific challenges and opportunities, aiming to inspire further research and practical applications.