A biosensor is a device that reacts with the analyte to be analyzed, detects its concentration, and generates readable information, which plays an important role in medical diagnosis, detection of physiological indicators, and disease prevention. Nanomaterials have received increasing attention in the fabrication and improvement of biosensors due to their unique physicochemical and optical properties. In this paper, the properties of nanomaterials such as the size effect, optical and electrical properties, and their advantages in the field of biosensing are briefly summarized, and the application of nanomaterials can effectively improve the sensitivity and reduce the detection limit of biosensors. The advantages of commonly used nanomaterials such as gold nanoparticles (AuNPs), carbon nanotubes (CNTs), quantum dots (QDs), graphene, and magnetic nanobeads for biosensor applications are also reviewed. Besides, the two main types of biosensors using nanomaterials involved in their construction and their working principles are described, and the toxicity and biocompatibility of nanomaterials and the future direction of nanomaterial biosensors are discussed.