Cancer-derived extracellular vesicles (EVs) are regarded as having promising potential to be used as therapeutics and disease biomarkers. Mechanistically, EVs have been shown to function in most, if not all, steps of cancer progression. Cancer EVs, including small EVs (sEVs), contain unique biomolecular cargo, consisting of protein, nucleic acid and lipids. Through progress in the identification of this specific cargo, cancer biomarkers have been identified and developed, opening up novel and interesting opportunities for cancer diagnosis and prognosis. Intriguingly, we still lack a comprehensive understanding of the cancer-specific pathways that govern EV biogenesis in cancer cells. Filling this knowledge gap will rapidly improve cancer EV biomarkers, as it will also allow discrimination of the procancer and anticancer actions of those EVs. Even more promising is uncovering therapeutically targetable, tumour-specific EV pathways and content, which will generate novel classes of cancer therapies. This Review highlights the progress the cancer sEV field has made in the areas of biomarker discovery and validation as well as sEV-based therapeutics, highlights the challenges we are facing and identifies gaps in our knowledge, which currently prevent us from developing the full potential of sEVs in cancer diagnostic and therapy.