Genetically encoded, fluorescent protein (FP)‐based Förster resonance energy transfer (FRET) biosensors are microscopy imaging tools tailored for the precise monitoring and detection of molecular dynamics within subcellular microenvironments. They are characterised by their ability to provide an outstanding combination of spatial and temporal resolutions in live‐cell microscopy. In this review, we begin by tracing back on the historical development of genetically encoded FP labelling for detection in live cells, which lead us to the development of early biosensors and finally to the engineering of single‐chain FRET‐based biosensors that have become the state‐of‐the‐art today. Ultimately, this review delves into the fundamental principles of FRET and the design strategies underpinning FRET‐based biosensors, discusses their diverse applications and addresses the distinct challenges associated with their implementation. We place particular emphasis on single‐chain FRET biosensors for the Rho family of guanosine triphosphate hydrolases (GTPases), pointing to their historical role in driving our understanding of the molecular dynamics of this important class of signalling proteins and revealing the intricate relationships and regulatory mechanisms that comprise Rho GTPase biology in living cells.