Invasive Candida infections represent a significant cause of morbidity and mortality in the neonatal intensive care unit (NICU), particularly among preterm and low birth weight neonates. The nonspecific clinical presentation of invasive candidiasis, resembling that of bacterial sepsis with multiorgan involvement, makes the diagnosis challenging. Given the atypical clinical presentation and the potential detrimental effects of delayed treatment, empirical treatment is often initiated in cases with high clinical suspicion. This underscores the need to develop alternative laboratory methods other than cultures, which are known to have low sensitivity and a prolonged detection time, to optimize therapeutic strategies. Serum biomarkers, including mannan antigen/anti-mannan antibody and 1,3-β-D-glucan (BDG), both components of the yeast cell wall, a nano-diagnostic method utilizing T2 magnetic resonance, and Candida DNA detection by PCR-based techniques have been investigated as adjuncts to body fluid cultures and have shown promising results in improving diagnostic efficacy and shortening detection time in neonatal populations. This review aims to provide an overview of the diagnostic tools and the current management strategies for invasive candidiasis in neonates. Timely and accurate diagnosis followed by targeted antifungal treatment can significantly improve the survival and outcome of neonates affected by Candida species.