There has been increased demand for durable and sustainable construction materials to improve long-term performance of buildings and infrastructure. Polymer modification is a well-known method for improving the properties of construction materials. However, the effectiveness of polymer modification has been limited by the low compatibility between construction materials and polymers, especially polymers from waste plastics and waste rubbers. This paper reviews state-of-the-art studies on compatibilizing polymers via polymer functionalization specifically for thermoplastic and thermosetting polymers. This paper further examines the efficacy of functionalization for enhancing the properties of construction materials. There are three conclusions from this review: (1) Functionalization of polymers by adding various functional groups to their surface can improve the compatibility of polymers and construction materials such as bitumen and concrete. (2) The efficacy of functionalization of a polymer is highly dependent on the grafting material, the grafting degree, and the architecture of the polymer's structure after functionalization. (3) The application of properly functionalized polymers in bitumen and concretes improves their mechanical properties. For instance, it was found that proper functionalization of waste plastics and rubbers can facilitate their use leading to a simultaneous solution for enhancing durability and sustainability of the built environment and addressing environmental concerns associated with the accumulation of those wastes in landfills. The study further identifies knowledge gaps pertaining to an in-depth understanding of polymer functionalization specifically tailored to construction materials and the need for associated life-cycle assessments. Addressing these gaps will facilitate the generation of value-added applications for waste polymeric materials to promote resource conservation and sustainability.