Early screening and diagnosis are the most effective ways to prevent the occurrence and progression of cancers, thus many biosensing strategies have been developed to achieve economic, rapid, and effective detection of various cancer biomarkers. Recently, functional peptides have been gaining increasing attention in cancer-related biosensing due to their advantageous features of a simple structure, ease of synthesis and modification, high stability, and good biorecognition, self-assembly and antifouling capabilities. Functional peptides can not only act as recognition ligands or enzyme substrates for the selective identification of different cancer biomarkers but also function as interfacial materials or self-assembly units to improve the biosensing performances. In this review, we summarize the recent advances in functional peptide-based biosensing of cancer biomarkers according to the used techniques and the roles of peptides. Particular attention is focused on the use of electrochemical and optical techniques, both of which are the most commonly used techniques in the field of biosensing. The challenges and promising prospects of functional peptide-based biosensors in clinical diagnosis are also discussed.