Cancer remains a leading global health burden, profoundly affecting patient survival and quality of life. Current treatments—including chemotherapy, radiotherapy, immunotherapy, and surgery—are often limited by toxicity or insufficient specificity. Conventional chemotherapy, for instance, indiscriminately attacks rapidly dividing cells, causing severe side effects. In contrast, peptide-based therapeutics offer a paradigm shift, combining high tumour-targeting precision with minimal off-target effects. Their low immunogenicity, multi-pathway modulation capabilities, and adaptability for diagnostics and therapy make them ideal candidates for advancing oncology care. Innovative peptide platforms now enable three transformative applications: (1) precision molecular diagnostics (e.g., 18F-PSMA-1007 for prostate cancer detection), (2) targeted therapies (e.g., BT5528 and SAR408701 targeting tumour-specific antigens), and (3) theranostic systems (e.g., RAYZ-8009 and 177Lu-FAP-2286 integrating imaging and radiotherapy). Despite their promise, peptides face challenges like metabolic instability and short half-lives. Recent advances in structural engineering (e.g., cyclization and D-amino acid incorporation) and delivery systems (e.g., nanoparticles and PEGylation) have significantly enhanced their clinical potential. This review highlights peptide-based agents in development, showcasing their ability to improve early cancer detection, reduce metastasis, and enhance therapeutic efficacy with fewer adverse effects. Examples like CLP002 underscore their role in personalised medicine. By overcoming current limitations, peptide drugs are poised to redefine cancer management, offering safer, more effective alternatives to conventional therapies. Their integration into clinical practice could mark a critical milestone in achieving precision oncology.