MXenes and their related nanocomposites with superior physicochemical properties such as high surface area, ease of synthesis and functionalization, high drug loading capacity, collective therapy potentials, pH-triggered drug release behavior, high photothermal conversion, and excellent photodynamic efficiency have been explored as alluring materials in photomedicine; the application of photons in medicine is facilitated for imaging and various disease treatment methods such as photothermal cancer/tumor ablation. Non-invasive theranostic strategies with synergistic activities have been developed using photothermal, photodynamic, and magnetic therapies together with remotely controlled drug/gene delivery for the diagnosis and treatment of various malignant diseases. Photothermal/photodynamic therapy and photoacoustic imaging using MXene-based structures have shown great promise in cancer phototherapy. However, hybridization and surface functionalization should be further explored to obtain biocompatible MXene-based composites/platforms with unique properties, high stability, and improved functionality in photomedicine. Toxicological and long-term biosafety assessments as well as clinical translation evaluations ought to be given high priority in research. Although some limited studies have revealed the excellent potentials of MXenes and their derivatives in photomedicine, further steps should be taken towards extensive research and detailed analysis in the field of optimizing the properties and improving the performance of these materials with a clinical and industrial outlook. Optical biosensing platforms have been developed along with electrochemical sensors and wearable sensors constructed from MXenes and their derivatives; future studies warrant the comprehensive analysis of optical transduction aspects such as colorimetry, electrochemiluminescence, photoluminescence, surface-enhanced Raman scattering, and surface plasmon resonance. Herein, the potentials of MXenes in photomedicine are deliberated encompassing important challenges and future research directions.