With the high morbidity and mortality caused by cancer, finding new and more effective anti-cancer drugs is very urgent. In current research, biotransformation plays a vital role in the research and development of cancer drugs and has obtained some achievements. In this review, we have summarized four applications as follows: to exploit novel anti-cancer drugs, to improve existing anti-cancer drugs, to broaden limited anti-cancer drug resources and to investigate correlative mechanisms. Three different groups of important anti-cancer compounds were assessed to clarify the current practical applications of biotransformation in the development of anti-cancer drugs.