Active targeting in cancer nanomedicine, for improved delivery of agents and diagnose, has been reviewed as a successful way for facilitating active uptake of theranostic agents by the tumor cells. The application of a targeting moiety in the targeted carrier complexes can play an important role in differentiating between tumor and healthy tissues. The pharmaceutical carriers, as main part of complexes, can be polymeric nanoparticles, micelles, liposomes, nanogels and carbon nanotubes. The antibodies are among the natural ligands with highest affinity and specificity to target pharmaceutical nanoparticle conjugates. However, the limitations, such as size and long circulating half-lives, hinder reproducible manufacture in clinical studies. Therefore, novel approaches have moved towards minimizing and engineering conventional antibodies as fragments like scFv, Fab, nanobody, bispecific antibody, bifunctional antibody, diabody and minibody preserving their functional potential. Different formats of antibody fragments have been reviewed in this literature update, in terms of structure and function, as smart ligands in cancer diagnosis and therapy of tumor cells.