Quantum dots (QDs), as nanostructured semiconductors, are used for the bioimaging purposes due to their unique features, including narrow emission spectra, size-tunable emission, broad absorption spectra, superior brightness and durability to photobleaching. Their conjugation with homing and therapeutic agents results in multimodal nanosystems, so-called theranostics. The main drawback of QD-based theranostics is their intrinsic toxicity because of cadmium ions. To attain safe and biocompatible QGs, different types of cadmium-free QDs (e.g., graphene and carbon QDs, silicon QDs, QDs of group III-V and group I−III-VI) have been engineered and examined both in vitro and in vivo. In this review, we aimed to provide comprehensive insights into the different types of cadmium-free QDs, depict the synthesis methods and analytical pros and cons, discuss the recent advancements of the cadmium-free QD-based nanosystems, and portray opportunities and challenges of using less toxic QDs for the development of QD-based theranostics.