Over the last few years, the development of fluorescent probes has received considerable attention. Fluorescence signaling allows noninvasive and harmless real-time imaging with great spectral resolution in living objects, which is extremely useful for modern biomedical applications. This review presents the basic photophysical principles and strategies for the rational design of fluorescent probes as visualization agents in medical diagnosis and drug delivery systems. Common photophysical phenomena, such as Intramolecular Charge Transfer (ICT), Twisted Intramolecular Charge Transfer (TICT), Photoinduced Electron Transfer (PET), Excited-State Intramolecular Proton Transfer (ESIPT), Fluorescent Resonance Energy Transfer (FRET), and Aggregation-Induced Emission (AIE), are described as platforms for fluorescence sensing and imaging in vivo and in vitro. The presented examples are focused on the visualization of pH, biologically important cations and anions, reactive oxygen species (ROS), viscosity, biomolecules, and enzymes that find application for diagnostic purposes. The general strategies regarding fluorescence probes as molecular logic devices and fluorescence–drug conjugates for theranostic and drug delivery systems are discussed. This work could be of help for researchers working in the field of fluorescence sensing compounds, molecular logic gates, and drug delivery.