Nail melanoma (NM) is an important differential diagnosis in patients with longitudinal melanonychia. However, diagnosis is often challenging as it is difficult to differentiate from other pigmented nail disorders. The main challenge for diagnosis is obtaining adequate nail matrix biopsy specimens for histopathological assessment. Furthermore, the histopathological changes in the early stages of NM are subtle and contribute to a delay in diagnosis and care. Therefore, the integration of clinical and histopathological analyses is essential. Clinical and dermoscopic features, such as a broadened width of asymmetric bands in an irregular pattern, with multicolour pigmentation, periungual pigmentation, and continuous growth, are features that support the diagnosis of NM. The essential histological features that must be assessed are cellular morphology, architectural features, melanocyte density, and inflammatory changes. The reported mutations in NMs were BRAF (0–43%), NRAS (0–31%), KIT (0–50%), NF1 (0–50%), and GNAQ (0–25%). Surgery is the primary treatment for NM. The recommended treatment for in situ or minimally invasive NM is functional surgery, but cases with suspected bone invasion should be treated with amputation. Targeted therapy and immunotherapy are indicated for advanced stages of NM. This review summarizes the updated guidelines for the diagnosis and treatment of NM.