Photothermal therapy (PTT) has emerged as a promising alternative to conventional cancer treatments such as radiation therapy, chemotherapy, and surgery. PTT uses light‐absorbing nanomaterials to induce localized hyperthermia and selectively eliminate cancer cells, thus offering advantages over traditional interventions. This literature review focuses on nanoparticles for PTT, their heating properties, and their functions in theragnostic applications for photothermal cancer treatment. It highlights the fundamental principles, recent spectroscopic developments for diagnosis and treatment monitoring, clinical advancements in near‐infrared (NIR) nanoparticle‐mediated PTT, and emerging numerical methods for preclinical planning of PTT.