Raman spectroscopy is an established laser-based technology for the quality assurance of pharmaceutical products. Over the past few years, Raman spectroscopy has become a powerful diagnostic tool in the life sciences. Raman spectra allow assessment of the overall molecular constitution of biological samples, based on specific signals from proteins, nucleic acids, lipids, carbohydrates, and inorganic crystals. Measurements are non-invasive and do not require sample processing, making Raman spectroscopy a reliable and robust method with numerous applications in biomedicine. Moreover, Raman spectroscopy allows the highly sensitive discrimination of bacteria. Rama spectra retain information on continuous metabolic processes and kinetics such as lipid storage and recombinant protein production. Raman spectra are specific for each cell type and provide additional information on cell viability, differentiation status, and tumorigenicity. In tissues, Raman spectroscopy can detect major extracellular matrix components and their secondary structures. Furthermore, the non-invasive characterization of healthy and pathological tissues as well as quality control and process monitoring of in vitro-engineered matrix is possible. This review provides comprehensive insight to the current progress in expanding the applicability of Raman spectroscopy for the characterization of living cells and tissues, and serves as a good reference point for those starting in the field.