A greater understanding of factors causing cancer initiation, progression and evolution is of paramount importance. Among them, the serine/threonine phosphatase PPM1D, also referred to as wild-type p53-induced phosphatase 1 (Wip1) or protein phosphatase 2C delta (PP2Cδ), is emerging as an important oncoprotein due to its negative regulation on a number of crucial cancer suppressor pathways. Initially identified as a p53-regulated gene, PPM1D has been afterwards found amplified and more recently mutated in many human cancers such as breast cancer. The latest progress in this field further reveals that selective inhibition of PPM1D to delay tumor onset or reduce tumor burden represents a promising anti-cancer strategy. Here, we review the advances in the studies of the PPM1D activity and its relevance to various cancers, and recent progress in development of PPM1D inhibitors and discuss their potential application in cancer therapy. Consecutive research on PPM1D and its relationship with cancer is essential, as it ultimately contributes to the etiology and treatment of cancer.