The dramatic rise in cancer incidence, alongside treatment deficiencies, has elevated cancer to the second-leading cause of death globally. The increasing morbidity and mortality of this disease can be traced back to a number of causes, including treatment-related side effects, drug resistance, inadequate curative treatment and tumor relapse. Recently, anti-cancer bioactive peptides (ACPs) have emerged as a potential therapeutic choice within the pharmaceutical arsenal due to their high penetration, specificity and fewer side effects. In this contribution, we present a general overview of the literature concerning the conformational structures, modes of action and membrane interaction mechanisms of ACPs, as well as provide recent examples of their successful employment as targeting ligands in cancer treatment. The use of ACPs as a diagnostic tool is summarized, and their advantages in these applications are highlighted. This review expounds on the main approaches for peptide synthesis along with their reconstruction and modification needed to enhance their therapeutic effect. Computational approaches that could predict therapeutic efficacy and suggest ACP candidates for experimental studies are discussed. Future research prospects in this rapidly expanding area are also offered.