Many diseases can be characterized by the abnormal activity exhibited by various biomolecules, the targeting of which can provide therapeutic and diagnostic utility. Recent trends in medicine and nanotechnology have prompted the development of protease sensitive nanomaterials systems for therapeutic, diagnostic, and theranostic applications. These systems can act specifically in response to the target enzyme and its associated disease conditions, thus enabling personalized treatment and improved prognosis. In this Review, we discuss recent advancements in the development of protease-responsive materials for imaging and drug delivery and analyze several representative systems to illustrate their key design principles.