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Solid-State fermentation (SSF) is a valuable process used for the enhancement of the nutritional profile of agro-industrial by-products. The main objective of the present study concerns the exploitation of a mixture consisting of Cottonseed Cake (CSC) and <i>Lathyrus clymenum</i> pericarp (LCP) at a ratio of 80–20% <i>w</i>/<i>w</i>, which was utilized as substrate for the initiated by <i>Pleurotus ostreatus</i> SSF process. The final goal is the improvement of their nutritional value and the parallel reduction in their gossypol content. The obtained results revealed a statistically significant increase (<i>p</i> < 0.05) in protein content by 34.91%, while 1,3-1,6 β-glucans exceeded a 5-fold statistically significant increment (<i>p</i> < 0.05) at Day 11. Furthermore, lignin was reduced significantly (−26.71%) at Day 11. Free gossypol’s presence was lowered by 12.45%, while SSF presented a profound effect concerning the total gossypol level since the latter underwent a statistically significant reduction (<i>p</i> < 0.05) that exceeded 9-fold at Day 11. The study herein highlights SSF’s efficiency as a potential means to reduce free and total gossypol content with a parallel upgrade of its nutritional value. The fermentation outcome reveals its potential as a feed supplement and contributes to the reduction in the environmental footprint within the framework of a circular economy.