Optical probes for near-infrared (NIR) light have clear advantages over UV/VIS-based optical probes, such as their low levels of interfering auto-fluorescence and high tissue penetration. The second NIR (NIR-II) window (1000-1350 nm) offers better light penetration, lower background signal, higher safety limit, and higher maximum permitted exposure than the first NIR (NIR-I) window (650-950 nm). Therefore, NIR-II laser-based photoacoustic (PA) and fluorescence (FL) imaging can offer higher sensitivity and penetration depth than was previously available, and deeper lesions can be treated in vivo by photothermal therapy (PTT) and photodynamic therapy (PDT) with an NIR-II laser than with an NIR-I laser. Advances in creation of novel nanomaterials have increased options for improving light-induced bioimaging and treatment. Nanotechnology can provide advantages such as good disease targeting ability and relatively long circulation times to supplement the advantages of optical technologies. In this review, we present recent progress in development and applications of NIR-II light-based nanoplatforms for FL, PA, image-guided surgery, PDT, and PTT. We also discuss recent advances in smart NIR-II nanoprobes that can respond to stimuli in the tumor microenvironment and inflamed sites. Finally, we consider the challenges involved in using NIR-II nanomedicine for effective diagnosis and treatment.