Healthcare, as a basic human right, has often become the focus of the development of innovative technologies. Technological progress has significantly contributed to the provision of high-quality, on-time, acceptable, and affordable healthcare. Advancements in nanoscience have led to the emergence of a new generation of nanostructures. Each of them has a unique set of properties that account for their astonishing applications. Since its inception, nanotechnology has continuously affected healthcare and has exerted a tremendous influence on its transformation, contributing to better outcomes. In the last two decades, the world has seen nanotechnology taking steps towards its omnipresence and the process has been accelerated by extensive research in various healthcare sectors. The inclusion of nanotechnology and its allied nanocarriers/nanosystems in medicine is known as nanomedicine, a field that has brought about numerous benefits in disease prevention, diagnosis, and treatment. Various nanosystems have been found to be better candidates for theranostic purposes, in contrast to conventional ones. This review paper will shed light on medically significant nanosystems, as well as their applications and limitations in areas such as gene therapy, targeted drug delivery, and in the treatment of cancer and various genetic diseases. Although nanotechnology holds immense potential, it is yet to be exploited. More efforts need to be directed to overcome these limitations and make full use of its potential in order to revolutionize the healthcare sector in near future.