Since its invention, atomic force microscopy (AFM) has come forth as a powerful member of the “scanning probe microscopy” (SPM) family and an unparallel platform for high-resolution imaging and characterization for inorganic and organic samples, especially biomolecules, biosensors, proteins, DNA, and live cells. AFM characterizes any sample by measuring interaction force between the AFM cantilever tip (the probe) and the sample surface, and it is advantageous over other SPM and electron micron microscopy techniques as it can visualize and characterize samples in liquid, ambient air, and vacuum. Therefore, it permits visualization of three-dimensional surface profiles of biological specimens in the near-physiological environment without sacrificing their native structures and functions and without using laborious sample preparation protocols such as freeze-drying, staining, metal coating, staining, or labeling. Biosensors are devices comprising a biological or biologically extracted material (assimilated in a physicochemical transducer) that are utilized to yield electronic signal proportional to the specific analyte concentration. These devices utilize particular biochemical reactions moderated by isolated tissues, enzymes, organelles, and immune system for detecting chemical compounds via thermal, optical, or electrical signals. Other than performing high-resolution imaging and nanomechanical characterization (e.g., determining Young’s modulus, adhesion, and deformation) of biosensors, AFM cantilever (with a ligand functionalized tip) can be transformed into a biosensor (microcantilever-based biosensors) to probe interactions with a particular receptors of choice on live cells at a single-molecule level (using AFM-based single-molecule force spectroscopy techniques) and determine interaction forces and binding kinetics of ligand receptor interactions. Targeted drug delivery systems or vehicles composed of nanoparticles are crucial in novel therapeutics. These systems leverage the idea of targeted delivery of the drug to the desired locations to reduce side effects. AFM is becoming an extremely useful tool in figuring out the topographical and nanomechanical properties of these nanoparticles and other drug delivery carriers. AFM also helps determine binding probabilities and interaction forces of these drug delivery carriers with the targeted receptors and choose the better agent for drug delivery vehicle by introducing competitive binding. In this review, we summarize contributions made by us and other researchers so far that showcase AFM as biosensors, to characterize other sensors, to improve drug delivery approaches, and to discuss future possibilities.