Follistatin-like protein 3 (FSTL3) is a type of FSTLs. By interacting with a disintegrin and metalloproteinase 12 (ADAM12), transforming growth factor-β ligands (activin, myostatin and growth differentiation factor (GDF) 11), FSTL3 can either activate or inhibit these molecules in human non-tumor pathophysiologies and cancers. The FSTL3 gene was initially discovered in patients with in B-cell chronic lymphocytic leukemia, and subsequent studies have shown that the FSTL3 protein is associated with reproductive development, insulin resistance, and hematopoiesis. FSTL3 reportedly contributes to the development and progression of many cancers by promoting tumor metastasis, facilitating angiogenesis, and inducing stem cell differentiation. This review summarizes the current pathophysiological roles of FSTL3, which may be a putative prognostic biomarker for various diseases and serve as a potential therapeutic target.