Through the use of the limited materials palette, optimally designed micro and nanostructures, and tightly regulated processes, nature demonstrates exquisite control of light matter interactions at various length scales. In fact, control of light matter interactions is an important element in the evolutionary arms race and has led to highly engineered optical materials and systems. In this review, we present a detailed summary of various optical effects found in nature with a particular emphasis on the materials and optical design aspects responsible for their optical functionality. Using several representative examples, we discuss various optical phenomena, including absorption and transparency, diffraction, interference, reflection and antireflection, scattering, light harvesting, wave guiding and lensing, camouflage, and bioluminescence, that are responsible for the unique optical properties of materials and structures found in nature and biology. Great strides in understanding the design principles adapted by nature have led to a tremendous progress in realizing biomimetic and bioinspired optical materials and photonic devices. We discuss the various micro- and nanofabrication techniques that have been employed for realizing advanced biomimetic optical structures.