Cathepsin Z/X (Cat Z/X) is a distinct member of the cysteine cathepsin family, known for its distinctive structural and functional properties, such as strict carboxypeptidase activity and integrin-binding motifs. These features set Cat Z/X apart from other cysteine proteases and underlie its involvement in diverse physiological and pathological processes, including immune regulation, cell signaling, and extracellular matrix remodeling. Dysregulated Cat Z/X expression and activity have been associated with various diseases, including cancer, neurodegenerative disorders, and metabolic conditions. This review summarizes current knowledge on Cat Z/X, focusing on its structural characteristics, biological functions, and roles in disease pathogenesis, particularly in malignancies, neuroinflammation, and metabolic disorders. It also explores natural and synthetic Cat Z/X inhibitors and their potential for therapeutic development. Despite growing research interest, the precise molecular mechanisms and context-specific functions of Cat Z/X are not yet fully understood. Further research is required to elucidate its regulatory networks, refine detection methods, and develop selective modulators targeting its proteolytic and non-proteolytic activities. A deeper understanding of Cat Z/X biology could pave the way for its application as a diagnostic biomarker and therapeutic target in numerous diseases.