Recent advancements in nanotechnology have enabled us to develop sophisticated multifunctional nanoparticles or nanosystems for targeted diagnosis and treatment of several illnesses, including cancers. To effectively treat any solid tumor, the therapy should preferably target just the malignant cells/tissue with minor damage to normal cells/tissues. Graphene oxide (GO) nanoparticles have gained considerable interest owing to their two-dimensional planar structure, chemical/mechanical stability, excellent photosensitivity, superb conductivity, high surface area, and good biocompatibility in cancer therapy. Many compounds have been functionalized on the surface of GO to increase their biological applications and minimize cytotoxicity. The review presents an overview of the physicochemical characteristics, strategies for various modifications, toxicity and biocompatibility of graphene and graphene oxide, current trends in developing GO-based nano constructs as a drug delivery cargo and other biological applications, including chemo-photothermal therapy, chemo-photodynamic therapy, bioimaging, and theragnosis in cancer. Further, the review discusses the challenges and opportunities of GO, GO-based nanomaterials for the said applications. Overall, the review focuses on the therapeutic potential of strategically developed GO nanomedicines and comprehensively discusses their opportunities and challenges in cancer therapy.