Nanodiamonds have excellent mechanical and optical properties, high surface areas and tunable surface structures. They are also non-toxic, which makes them well suited to biomedical applications. Here we review the synthesis, structure, properties, surface chemistry and phase transformations of individual nanodiamonds and clusters of nanodiamonds. In particular we discuss the rational control of the mechanical, chemical, electronic and optical properties of nanodiamonds through surface doping, interior doping and the introduction of functional groups. These little gems have a wide range of potential applications in tribology, drug delivery, bioimaging and tissue engineering, and also as protein mimics and a filler material for nanocomposites.