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Ginsenosides, as the most important constituents of ginseng, have been extensively investigated in cancer chemoprevention and therapeutics. Among the ginsenosides, Compound K (CK), a rare protopanaxadiol type of ginsenoside, has been most broadly used for cancer treatment due to its high anticancer bioactivity. However, the functional mechanism of CK in cancer is not well known. This review describes the structure, transformation and pharmacological activity of CK and discusses the functional mechanisms of CK and its metabolites, which regulate signaling pathways related to tumor growth and metastasis. CK inhibits tumor growth by inducing tumor apoptosis and tumor cell differentiation, regulates the tumor microenvironment by suppressing tumor angiogenesis-related proteins, and downregulates the roles of immunosuppressive cells, such as myeloid-derived suppressor cells (MDSCs). There is currently much research on the potential development of CK as a new strategy when administered alone or in combination with other compounds.