Rare earth based nanostructures constitute a type of functional materials widely used and studied in the recent literature. The purpose of this review is to provide a general and comprehensive overview of the current state of the art, with special focus on the commonly employed synthesis methods and functionalization strategies of rare earth based nanoparticles and on their different bioimaging and biosensing applications. The luminescent (including downconversion, upconversion and permanent luminescence) and magnetic properties of rare earth based nanoparticles, as well as their ability to absorb X‐rays, will also be explained and connected with their luminescent, magnetic resonance and X‐ray computed tomography bioimaging applications, respectively. This review is not only restricted to nanoparticles, and recent advances reported for in other nanostructures containing rare earths, such as metal organic frameworks and lanthanide complexes conjugated with biological structures, will also be commented on.