For nanoparticles stabilized by self-assembled monolayers, the surface-bound molecular species not only modify the core material properties but also provide a handle for interaction with other components, whether they are molecular, nanoscale, or even macroscopic. Importantly, when confined to nanosurfaces, these organic entities exhibit emergent properties that impart unique functionalities to the underlying nanomaterial. In this Review, we examine how these capabilities originate from the structural organization and collective interactions within on-nanoparticle self-assembled monolayers, drawing on examples of quasi-spherical nanoparticles smaller than ca. 8 nm in size. Our focus spans four key categories of function: (i) catalysis and chemical transformation under nanoconfinement, (ii) molecular recognition and sensing, (iii) switching and adaptation, and (iv) programmable nanoparticle assembly. By adopting a systems-chemistry perspective to identify how function is defined by chemical constitution, we elucidate design principles and strategies that we envisage can be broadly applied to a variety of hybrid organic-inorganic nanosystems. We also highlight the current challenges and future opportunities in the field of functional nanoparticles stabilized by self-assembled monolayers. Our aim is to motivate the community to shift toward a perspective in which the organic layer is understood as an active driver of the system functionality rather than a passive component. By harnessing its dynamic and adaptative nature, researchers can design functionally sophisticated and chemically programmable nanomaterials, unlocking unexplored possibilities in active materials, nanocatalysis, molecular recognition, sensing, and delivery.