Eco-friendly natural pigment demand has ever-increasing popularity due to health and environmental concerns. In this context, the aim of this study was to evaluate the feasibility use of Saba banana peel as low-cost fermentable substrate for the production of pigments, xylanase and cellulase enzymes by Monascus purpureus. Among the strains tested, M. purpureus TISTR 3385 produced pigments better and had higher enzyme activities. Under the optimal pigment-producing conditions at the initial moisture content of 40% and initial pH of 6.0, the pigments comprising yellow, orange, and red produced by the fungi were achieved in the range of 0.40–0.93 UA/g/day. The maximum xylanase and cellulase activities of 8.92 ± 0.46 U/g and 4.72 ± 0.04 U/g were also obtained, respectively. More importantly, solid-state fermentation of non-sterile peel could be achieved without sacrificing the production of the pigments and both enzymes. These indicated the potential use of the peel as fermentable feedstock for pigment production by the fungi and an environmental-friendly approach for sustainable waste management and industrial pigment and enzyme application.