Recent advances in inorganic nanomaterial-based theranostics enabled imaging-guided molecular targeting and drug delivery, and various combinations of theranostic systems. The term “theranostics” is defined as diagnosis processed with therapy simultaneously with a specific connection between therapy and diagnosis. The inorganic nanomaterials, representatively carbon, metal, ceramic, and semiconductor-based nanomaterials, exhibit their unique characteristics to be used in theranostic applications. However, the unveiled human biosafety of nanomaterials for clinical use has become a major concern. Therefore, in this review, we compiled recent research on in vitro and in vivo biosafety of inorganic nanomaterials in various theranostic applications, along with a discussion of how the particle formulation, size, surface functionalization, test species, and test condition affect biocompatibility. Furthermore, the progress and challenges of the development of biocompatible inorganic nanomaterials for theranostic applications were discussed. In conclusion, with appropriate precautions on the biosafe condition to be administered, inorganic nanomaterials can be proposed to have excellent potential in the future theranostic application.