Enhancing tumor homing and improving the efficacy of drugs are urgent needs for cancer treatment. Herein a novel targeted, intracellularly activatable fluorescence and cytotoxicity nanodiamond (ND) drug system (ND-PEG-HYD-FA/DOX, NPHF/D) was successfully prepared based on doxorubicin (DOX) and folate (FA) covalently bound to PEGylated NDs, in which the DOX was covalently coupled via an intracellularly hydrolyzable hydrazone bond that was stable in the physiological environment to ensure minimal drug release in circulation. Cell uptake studies demonstrated the selective internalization of NPHF/D by folate receptor (FR) mediated endocytosis in the order MCF-7 > HeLa > HepG2 ≫ CHO, using confocal laser scanning microscopy (CLSM) and flow cytometry. Interestingly, the DOX fluorescence of NPHF/D was significantly quenched, while the fluorescence recovery and cytotoxicity took place by low pH regulation in intracellular lysosomes, which made NPHF/D act as a fluorescence OFF-ON messenger for activatable imaging and cancer therapy. Of note, NPHF/D significantly inhibited the growth of tumors. Simultaneously, it was demonstrated that the introduction of FA and the cleavability of the hydrazone greatly enhanced the therapeutic performance of NPHF/D. In addition, toxicity studies in mice verified that the composites were devoid of any detected hepatotoxicity, cardiotoxicity, and nephrotoxicity using histopathology and blood biochemistry studies. Our work provides a novel strategy for cancer therapy, using ND-conjugated cancer drugs, and the exploration of theranostic drug-delivery systems.