Chitin and its derivative chitosan are highly abundant polymers in nature, appearing in both the shells and exoskeletons of various marine and non-marine species. Since they possess favorable properties, such as biocompatibility, biodegradability, non-toxicity, and non-immunogenicity, they have gained recent attention due to their enormous potential biomedical applications. The polycationic surface of chitosan enables it to form hydrogenic and ionic bonds with drug molecules, which is one of its most useful properties. Because chitosan is biocompatible, it can therefore be used in drug delivery systems. The development of chitosan-based nanoparticles has also contributed to the significance of chitin as a drug delivery system that can deliver drugs topically. Furthermore, chitin can be used in cancer treatment as a vehicle for delivering cancer drugs to a specific site and has an antiproliferative effect by reducing the viability of cells. Finally, chitosan can be used as a wound dressing in order to promote the faster regeneration of skin epithelial cells and collagen production by fibroblasts. As discussed in this review, chitin and chitosan have diverse applications in the medical field. Recognizing the biomedical applications of these two polymers is essential for future research in tissue engineering and nanobiotechnology.