Dihydroceramide (dhCer) was previously considered an inactive precursor of ceramide, a well-known sphingoid base involved in regulating apoptosis and cell death. However, recent studies have shown that dhCer plays a crucial role in various important cellular responses. In this review, we summarize the latest findings on the biological functions of dhCer and the enzymes involved in its biosynthesis. We specifically focus on the emerging evidence implicating dhCer in cancer, as well as its role in regulating key processes such as cell cycle arrest, autophagy, apoptosis, ER stress, and oxidative stress. Furthermore, we discuss bioactive compounds that can modulate dhCer levels in cancer cells, highlighting their potential therapeutic applications in counteracting cancer progression. This review emphasizes the growing recognition of dhCer as a bioactive sphingolipid metabolite with significant potential for cancer therapy.