Premenstrual dysphoric disorder (PMDD) is a severe variant of premenstrual syndrome (PMS), categorized as a mood disorder due to marked symptoms of depression and anxiety, compounded with severe physical symptoms. Female sexual dysfunction (FSD) can manifest as low libido, difficulty achieving sexual pleasure, and dyspareunia, causing functional and psychological distress. PMDD and FSD are globally prevalent conditions with postulated biological, psychological, and social associations between them. Nevertheless, sexual dysfunction in PMDD is an important aspect of women's health that has been understudied and has notable methodological limitations. In this narrative review, we summarize the existing literature on sexual function in women with PMDD and PMS, specify the distinctions between PMDD and other general symptoms of PMS, highlight the significance of understanding sexual dysfunction in the female population, and outline some available therapeutic options. Studies show that women frequently experience debilitating sexual distress during the premenstrual phase; however, there is an essential need to formulate standardized tools for definite diagnosis. Selective serotonin re-uptake inhibitors (SSRIs) and combined oral contraceptive pills (COCPs) are approved medications for PMDD, while flibanserin and bremelanotide are effective in treating FSD. However, the potential effects of these treatment modalities on the two comorbid conditions render them inconclusive. Awareness of PMDD and FSD among clinicians and society can allow the implementation of targeted interventions to alleviate the suffering of women and enhance their quality of life.