Ground-breaking advances in nanomedicine (defined as the application of nanotechnology in medicine) have proposed novel therapeutics and diagnostics, which can potentially revolutionize current medical practice. Polyhedral oligomeric silsesquioxane (POSS) with a distinctive nanocage structure consisting of an inner inorganic framework of silicon and oxygen atoms, and an outer shell of organic functional groups is one of the most promising nanomaterials for medical applications. Enhanced biocompatibility and physicochemical (material bulk and surface) properties have resulted in the development of a wide range of nanocomposite POSS copolymers for biomedical applications, such as the development of biomedical devices, tissue engineering scaffolds, drug delivery systems, dental applications, and biological sensors. The application of POSS nanocomposites in combination with other nanostructures has also been investigated including silver nanoparticles and quantum dot nanocrystals. Chemical functionalization confers antimicrobial efficacy to POSS, and the use of polymer nanocomposites provides a biocompatible surface coating for quantum dot nanocrystals to enhance the efficacy of the materials for different biomedical and biotechnological applications. Interestingly, a family of POSS-containing nanocomposite materials can be engineered either as completely non-biodegradable materials or as biodegradable materials with tuneable degradation rates required for tissue engineering applications. These highly versatile POSS derivatives have created new horizons for the field of biomaterials research and beyond. Currently, the application of POSS-containing polymers in various fields of nanomedicine is under intensive investigation with expectedly encouraging outcomes.