Gastrointestinal cancers are highly aggressive malignancies with significant mortality rates. Recent research emphasizes the critical role of the tumor microenvironment (TME) in these cancers, which includes cancer-associated fibroblasts (CAFs), a key component of the TME that have diverse origins, including fibroblasts, mesenchymal stem cells, and endothelial cells. Several markers, such as α-SMA and FAP, have been identified to label CAFs, and some specific markers may serve as potential therapeutic targets. In this review article, we summarize the literature on the multifaceted role of CAFs in tumor progression, including their effects on angiogenesis, immune suppression, invasion, and metastasis. In addition, we highlight the use of single-cell transcriptomics to understand CAF heterogeneity and their interactions within the TME. Moreover, we discuss the dynamic interplay between CAFs and the immune system, which contributes to immunosuppression in the TME, and the potential for CAF-targeted therapies and combination approaches with immunotherapy to improve cancer treatment outcomes.