This study aimed to investigate the efficacy of banana peel extract as a possible substitute for the environmentally unfavorable sodium dithionite in cellulosic fiber dyeing with indigo. Antioxidant activity and total sugar content of the banana peel extract were measured. Composition of the extract was investigated by GC/MS analysis. Its reducing power for synthetic indigo was evaluated by reduction potential measurements and dyeing tests. It was shown that the studied extract could be applied successfully in the reduction of indigo in spite of their lower reducing power when compared with that of sodium dithionite. In dyeing study, sodium dithionite showed its superiority in term of reducing power over the studied extract but the studied extract was superior stability of reduction to sodium dithionite. So, it can be concluded that banana peel extract could be a biodegradable and sustainable alternative to sodium dithionite as a reducing agent in indigo dyeing processes.