Cancer is one of the major noncommunicable diseases, responsible for millions of deaths every year worldwide. Though various cancer detection and treatment modalities are available today, many deaths occur owing to its late-stage detection and metastatic nature. Noninvasive detection using luminescence-based imaging tools is considered one of the promising techniques owing to its low cost, high sensitivity, and brightness. Moreover, these tools are unique and valuable as they can detect even the slightest changes in the cellular microenvironment. To achieve this, a fluorescent probe with strong tumor uptake and high spatial and temporal resolution, especially with high water solubility, is highly demanded. Recently, several water-soluble molecules with emission windows in the visible (400-700 nm), first near-infrared (NIR-I, 700-1000 nm), and second near-infrared (NIR-II, 1000-1700 nm) windows have been reported in literature. This review highlights recently reported water-soluble small organic fluorophores/dyes with applications in cancer diagnosis and therapeutics. We systematically highlight and describe the key concepts, structural classes of fluorophores, strategies for imparting water solubility, and applications in cancer therapy and diagnosis, i.e., theragnostics. We discuss examples of water-soluble fluorescent probes based on coumarin, xanthene, boron-dipyrromethene (BODIPY), and cyanine cores. Some other emerging classes of dyes based on carbocyclic and heterocyclic cores are also discussed. Besides, emerging molecular engineering methods to obtain such fluorophores are discussed. Finally, the opportunities and challenges in this research area are also delineated.