Extracellular vesicles (EVs), a diverse group of cell-derived exocytosed particles, are pivotal in mediating intercellular communication due to their ability to selectively transfer biomolecules to specific cell types. EVs, composed of proteins, nucleic acids, and lipids, are taken up by cells to affect a variety of signaling cascades. Research in the field has primarily focused on stem cell-derived EVs, with a particular focus on mesenchymal stem cells, for their potential therapeutic benefits. Recently, tissue-specific EVs or cell type-specific extracellular vesicles (CTS-EVs), have garnered attention for their unique biogenesis and molecular composition because they enable highly targeted cell-specific communication. Various studies have outlined the roles that CTS-EVs play in the signaling for physiological function and the maintenance of homeostasis, including immune modulation, tissue regeneration, and organ development. These properties are also exploited for disease propagation, such as in cancer, neurological disorders, infectious diseases, autoimmune conditions, and more. The insights gained from analyzing CTS-EVs in different biological roles not only enhance our understanding of intercellular signaling and disease pathogenesis but also open new avenues for innovative diagnostic biomarkers and therapeutic targets for a wide spectrum of medical conditions. This review comprehensively outlines the current understanding of CTS-EV origins, function within normal physiology, and implications in diseased states.