CAR-T cells are genetically modified T lymphocytes that express chimeric antigen receptors (CAR) on their surfaces. These receptors enable T lymphocytes to recognize specific antigens on target cells, triggering a response that leads to targeted cytotoxicity. While CAR-T therapy has effectively treated various blood cancers, it faces significant challenges in addressing solid tumors. These challenges include identifying precise tumor antigens, overcoming antigen evasion, and enhancing the function of CAR-T cells within the tumor microenvironment. Single domain antibody, versatile tools with low immunogenicity, high stability, and strong affinity, show promise for improving the efficacy of CAR-T cells against solid tumors. By addressing these challenges, single domain antibody has the potential to overcome the limitations associated with ScFv antibody-based CAR-T therapies. This review highlights the benefits of utilizing single domain antibody in CAR-T therapy, particularly in targeting tumor antigens, and explores development strategies that could advance the field.