Long non-coding RNAs (lncRNAs) are typically described as RNA transcripts exceeding 200 nucleotides in length, which do not code for proteins. Recent advancements in technology, including ribosome RNA sequencing and ribosome nascent-chain complex sequencing, have demonstrated that many lncRNAs retain small open reading frames and can potentially encode micropeptides. Emerging studies have revealed that these micropeptides, rather than lncRNAs themselves, are responsible for vital functions, including but not limited to regulating homeostasis, managing inflammation and the immune system, moderating metabolism, and influencing tumor progression. In this review, we initially outline the rapidly advancing computational analytical methods and public tools to predict and validate the potential encoding of lncRNAs. We then focus on the diverse functions of micropeptides and their underlying mechanisms in the pathogenesis of disease. This review aims to elucidate the functions of lncRNA-encoded micropeptides and explore their potential applications as therapeutic targets in cancer.