Cancer is a common cause of death worldwide. Despite significant advances in cancer treatments, the morbidity and mortality are still enormous. Tumor heterogeneity, especially intratumoral heterogeneity, is a significant reason under-lying difculties in tumor treatment and failure of a number of current therapeutic modalities, even of molecularly targeted therapies. The development of a virtually noninvasive“liquid biopsy”from the blood has been attempted to characterize tumor heterogeneity. This review focuses on cell-free circulating tumor DNA (ctDNA) in the bloodstream as a versatile biomarker. ctDNA analysis is an evolving field with many new methods being developed and optimized to be able to successfully extract and analyze ctDNA, which has vast clinical applications. ctDNA has the potential to accurately genotype the tumor and identify personalized genetic and epigenetic alterations of the entire tumor. In addition, ctDNA has the potential to accurately monitor tumor burden and treatment response, while also being able to monitor minimal residual disease, reducing the need for harmful adjuvant chemotherapy and allowing more rapid detection of relapse. There are still many challenges that need to be overcome prior to this biomarker getting wide adoption in the clinical world, including optimization, standardization, and large multicenter trials.