Biologically active compounds with different modes of action, such as, antiproliferative, antioxidant, antimicrotubule, have been isolated from marine sources, specifically algae and cyanobacteria. Recently research has been focused on peptides from marine animal sources, since they have been found as secondary metabolites from sponges, ascidians, tunicates, and mollusks. The structural characteristics of these peptides include various unusual amino acid residues which may be responsible for their bioactivity. Moreover, protein hydrolysates formed by the enzymatic digestion of aquatic and marine by-products are an important source of bioactive peptides. Purified peptides from these sources have been shown to have antioxidant activity and cytotoxic effect on several human cancer cell lines such as HeLa, AGS, and DLD-1. These characteristics imply that the use of peptides from marine sources has potential for the prevention and treatment of cancer, and that they might also be useful as molecular models in anticancer drug research. This review focuses on the latest studies and critical research in this field, and evidences the immense potential of marine animals as bioactive peptide sources.