Several metal nanoparticles have been developed for medical application. While all have their benefits, gold nanoparticles (AuNPs) are ideal in cancer therapy and diagnosis as they are chemically inert and minimally toxic. Several studies have shown the potential of AuNPs in the therapeutic field, as photosensitizing agents in sonochemical and photothermal therapy and as drug delivery, as well as in diagnostics and theranostics. Although there is a significant number of reviews on the application of AuNPs in cancer medicine, there is no comprehensive review on their application both in therapy and diagnostics. Therefore, considering the high number of studies on AuNPs’ applications, this review summarizes data on the application of AuNPs in cancer therapy and diagnostics. In addition, we looked at the influence of AuNPs’ shape and size on their biological properties. We also present the potential use of hybrid materials based on AuNPs in sonochemical and photothermal therapy and the possibility of their use in diagnostics. Despite their potential, the use of AuNPs and derivatives in cancer medicine still has some limitations. In this review, we provide an overview of the biological, physicochemical, and legal constraints on using AuNPs in cancer medicine. © 2021 by the authors. Licensee MDPI, Basel, Switzerland.