Macrophages play vital functions in host inflammatory reaction, tissue repair, homeostasis and immunity. Dysfunctional macrophages have significant pathophysiological impacts on diseases such as cancer, inflammatory diseases (rheumatoid arthritis and inflammatory bowel disease), metabolic diseases (atherosclerosis, diabetes and obesity) and major infections like human immunodeficiency virus infection. In view of this common etiology in these diseases, targeting the recruitment, activation and regulation of dysfunctional macrophages represents a promising therapeutic strategy. With the advancement of nanotechnology, development of nanomedicines to efficiently target dysfunctional macrophages can strengthen the effectiveness of therapeutics and improve clinical outcomes. This review discusses the specific roles of dysfunctional macrophages in various diseases and summarizes the latest advances in nanomedicine-based therapeutics and theranostics for treating diseases associated with dysfunctional macrophages.