This article analyzes and summarizes recent developments and newly emerging research fields related to thiol-capped CdTe nanocrystals, the most successful example of the colloidal quantum dots directly synthesized in aqueous solution. Progress in the synthesis and design of novel materials and functionalities, sophisticated assemblies of thiol-capped nanocrystals, development and validation of analytical and spectroscopic methods relying on thiol-capped CdTe nanocrystals as a model system, and, finally, applications of thiol-capped semiconductor nanocrystals in various fields ranging from light harvesting and energy transfer to biotechnology are addressed.