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Bacterial extracellular vesicles (bEVs) are nano-sized, lipid membrane-delimited particles filled with bacteria-derived components. They have important roles in the physiology and pathogenesis of bacteria, and in bacteria-bacteria and bacteria-host interactions. Interestingly, recent advances in biotechnology have made it possible to engineer the bEV surface and decorate it with diverse biomolecules and nanoparticles (NPs). bEVs have been the focus of significant interest in a range of biomedical fields and are being evaluated as vaccines, cancer immunotherapy agents, and drug delivery vehicles. However, significant hurdles in terms of their safety, efficacy, and mass production need to be addressed to enable their full clinical potential. Here, we review recent advances and remaining obstacles regarding the use of bEVs in different biomedical applications and discuss paths toward clinical translation.