Detection of colorimetric signals is commonly used in various analytical methods and for testing in non‐laboratory and resource‐limited settings. The performance of colorimetric assays is largely based on nanoparticles and their unique optical properties. Multifunctional nanoparticles combining optical and enzyme‐like catalytic properties—known as nanozymes—hold great promise for analytical applications as signal‐generating labels. However, the extensive focus on the catalytic properties leaves their unique optical properties overlooked. In this article, the use of the optical and catalytic properties of nanozymes is reviewed for analytical applications relying on the inherent optical properties of nanozymes, the colorimetric detection of a catalytically‐formed product, and colorimetric changes of nanoparticles caused by the catalytically‐formed product. The impact of the extinction coefficient of nanozymes and reaction products, as well as the kinetic parameters of nanozymes on the sensitivity and limit of detection of assays, are quantitatively evaluated. Finally, the existing limitations and prospects of nanozymes for colorimetric biosensors are summarized.