Nanoparticles have recently emerged as an important group of materials used in numerous disciplines within the life sciences, ranging from basic biophysical research to clinical therapeutics. Luminescent nanoparticles make excellent optical bioprobes significantly extending the capabilities of alternative fluorophores such as organic dyes and genetically engineered fluorescent proteins. Their advantages include excellent photostability, tunable and narrow spectra, controllable size, resilience to environmental conditions such as pH and temperature, combined with a large surface for anchoring targeting biomolecules. Some types of nanoparticles provide enhanced detection contrast due to their long emission lifetime and/or luminescence wavelength blue-shift (anti-Stokes) due to energy upconversion. This topical review focuses on four key types of luminescent nanoparticles whose emission is governed by different photophysics. We discuss the origin and characteristics of optical absorption and emission in these nanoparticles and give a brief account of synthesis and surface modification procedures. We also introduce some of their applications with opportunities for further development, which could be appreciated by the physics-trained readership.