Carbon nanotubes (CNTs) are cylindrical nanostructures made of rolled-up sheets of single-layer carbon atoms (graphene) with remarkable mechanical, electrical, and thermal properties. Since their discovery, carbon nanotubes (CNTs) have transformed the study of nanomaterials and shown unmatched promise in the biological sciences. This study outlines current developments in CNT-based pharmaceutical applications, with an emphasis on biosensing, tissue engineering, drug delivery systems, and diagnostic imaging. These nanoscale structures have the potential to revolutionize therapeutic efficacy, precision targeting, and diagnostic accuracy due to their remarkable surface area, adaptable surface chemistry, and exceptional biocompatibility. A thorough analysis of the literature shows that CNTs greatly improve drug delivery through increased solubility, stability, and targeted distribution, which improves bioavailability and therapeutic results. Functionalized carbon nanotubes (CNTs) improve resolution and contrast in magnetic resonance imaging (MRI), computed tomography (CT), and fluorescence imaging. This helps in early illness identification and tracking. CNT-based scaffolds are used in tissue engineering to imitate the extracellular matrix, which is essential for tissue regeneration as it promotes cell adhesion, proliferation, and differentiation. Furthermore, CNT-based biosensors show great promise in clinical diagnostics due to their remarkable sensitivity and specificity in identifying a wide range of chemicals and pathogens. However, issues including possible toxicity, biocompatibility over the long term, and the requirement for standardized procedures for CNT characterisation and functionalization continue to be problems. For CNT-based technologies to be successfully translated into clinical practice, these problems must be resolved. All things considered, CNTs have enormous potential to transform pharmaceutical applications, and more multidisciplinary research is needed to fully realize their potential for advancements in medicine.