Multifunctional Material is defined to be any material or material-based system which integrally combines two [or possibly more] properties, one of which is normally structural and the other functional, e.g. optical, electrical, magnetic, thermal etc... The integration of multifunctional values in such a common material has become a special area of interest in recent years. Smart Textile represents the next generation of textiles anticipated for use in several fashion, furnishing and technical textile applications. The term smart is used to refer to materials that sense and respond in a pre-defined manner to environmental stimuli. The degree of smartness varies and it is possible to enhance the intelligence further by combining these materials with a controlling unit Improvement of existing properties and the creation of new material properties are the most important reasons for the functionalization of textiles. Polymer nano composites offer the possibility of developing a new class of nanofinishing materials for textiles with their own manifold of structure property relationship only indirectly related to their components and their micron and macro-scale composite counterparts. Functionalisation of textiles is an approach to improve the native properties as well as to impart new functions in the textile products. The functional finishes impart new properties such as UV resistance, photo-catalytic activity, flame retardency, antibiotic , antistatic, antimicrobial activity and wrinkle recovery to the fabrics.