Nanoparticle (NP) functionalization with specific ligands enhances targeted cancer therapy and imaging by promoting receptor recognition and improving cellular uptake. This review focuses on recent research exploring the interaction between cancer cell-expressed chemokine receptor 4 (CXCR4) and ligand-conjugated NPs, utilising small molecules, peptides, and antibodies. Active NP targeting has shown improved tumour targeting and reduced toxicity, enabling precision therapy and diagnosis. However, challenges persist in the clinical translation of targeted NPs due to issues with biological response, tumour accumulation, and maintaining NP quality at an industrial scale. Biological and intratumoral barriers further hinder efficient NP accumulation in tumours, hampering translatability. To address these challenges, the academic community is refocusing efforts on understanding NP biological fate and establishing robust preclinical models. Future studies should investigate NP-body interactions, develop computational models, and identify optimal preclinical models. Establishing central NP research databases and fostering collaboration across disciplines is crucial to expediting clinical translation. Overcoming these hurdles will unlock the transformative potential of CXCR4-ligand-NP conjugates in revolutionising cancer treatment.