Entomotherapy, the use of insects for medicinal purposes, has been practised for centuries in many countries around the world. More than 2100 edible insect species are eaten by humans, but little is known about the possibility of using these insects as a promising alternative to traditional pharmaceuticals for treating diseases. This review offers a fundamental understanding of the therapeutic applications of insects and how they might be used in medicine. In this review, 235 insect species from 15 orders are reported to be used as medicine. Hymenoptera contains the largest medicinal insect species, followed by Coleoptera, Orthoptera, Lepidoptera, and Blattodea. Scientists have examined and validated the potential uses of insects along with their products and by-products in treating various diseases, and records show that they are primarily used to treat digestive and skin disorders. Insects are known to be rich sources of bioactive compounds, explaining their therapeutic features such as anti-inflammatory, antimicrobial, antiviral, and so on. Challenges associated with the consumption of insects (entomophagy) and their therapeutic uses include regulation barriers and consumer acceptance. Moreover, the overexploitation of medicinal insects in their natural habitat has led to a population crisis, thus necessitating the investigation and development of their mass-rearing procedure. Lastly, this review suggests potential directions for developing insects used in medicine and offers advice for scientists interested in entomotherapy. In future, entomotherapy may become a sustainable and cost-effective solution for treating various ailments and has the potential to revolutionize modern medicine.