Cancer is a genetic disease stemming from genetic and epigenetic mutations and is the second most common cause of death across the globe. Clustered regularly interspaced short palindromic repeats (CRISPR) is an emerging gene-editing tool, acting as a defense system in bacteria and archaea. CRISPR/Cas9 technology holds immense potential in cancer diagnosis and treatment and has been utilized to develop cancer disease models such as medulloblastoma and glioblastoma mice models. In diagnostics, CRISPR can be used to quickly and efficiently detect genes involved in various cancer development, proliferation, metastasis, and drug resistance. CRISPR/Cas9 mediated cancer immunotherapy is a well-known treatment option after surgery, chemotherapy, and radiation therapy. It has marked a turning point in cancer treatment. However, despite its advantages and tremendous potential, there are many challenges such as off-target effects, editing efficiency of CRISPR/Cas9, efficient delivery of CRISPR/Cas9 components into the target cells and tissues, and low efficiency of HDR, which are some of the main issues and need further research and development for completely clinical application of this novel gene editing tool. Here, we present a CRISPR/Cas9 mediated cancer treatment method, its role and applications in various cancer treatments, its challenges, and possible solution to counter these challenges.