Photodynamic therapy (PDT) procedure has minimum invasiveness in contrast to conventional anticancer surgical procedures. Although clinically approved a few decades ago, it is not commonly used due to its poor efficacy, mainly due to poor light penetration into deeper tissues. PDT uses a photosensitizer (PS), which is photoactivated on illumination by light of appropriate wavelength and oxygen in the tissue, leading to a series of photochemical reactions producing reactive oxygen species (ROS) triggering various mechanisms resulting in lethal effects on tumor cells. This review looks into the fundamental aspects of PDT, such as photochemistry, photobiological effects, and the current clinical applications in the light of improving PDT to become a mainstream therapeutic procedure against a broad spectrum of cancers and malignant lesions. The side effects of PDT, both early and late-onset, are elaborated on in detail to highlight the available options to minimize side effects without compromising therapeutic efficacy. This paper summarizes the benefits, drawbacks, and limitations of photodynamic therapy along with the recent attempts to achieve improved therapeutic efficacy via monitoring various cellular and molecular processes through fluorescent imagery aided by suitable biomarkers, prospective nanotechnology-based targeted delivery methods, the use of scintillating nanoparticles to deliver light to remote locations and also combining PDT with conventional anticancer therapies have opened up new dimensions for PDT in treating cancers. This review inquires and critically analyses prospective avenues in which a breakthrough would finally enable PDT to be integrated into mainstream anticancer therapy.