Programmable modular reaction, combined with excellent biocompatibility, has endowed biological circuits based on the nucleic acid TMSD (toehold-mediated strand displacement) reaction with great potential for bioanalysis and biomedical research. In this review, we summarize recent research on the principles of TMSD reaction and its applications in the cell environment. Based on the basic reaction units of the TD (toehold displacement) reaction, TE (toehold exchange) reaction, and CD (cooperation displacement) reaction, different reaction models could be obtained through the recombination of the basic reaction units. We highlight the successful development of the application of TMSD reaction for cell recognition, targeted therapy, molecular sensing and imaging and gene manipulations in the cell environment. Finally, we discuss the challenges and future opportunities of TMSD reaction for cellular applications.