Abstract Background The promise of precision cancer medicine presently centers around the genomic sequence of a patient’s tumor being translated into timely, actionable information to inform clinical care. The analysis of cell-free DNA from liquid biopsy, which contains circulating tumor DNA (ctDNA) in patients with cancer, has proven to be amenable to various settings in oncology. However, open questions surrounding the clinical validity and utility of plasma-based analyses have hindered widespread clinical adoption. Main body Owing to the rapid evolution of the field, studies supporting the use of ctDNA as a biomarker throughout a patient’s journey with cancer have accumulated in the last few years, warranting a review of the latest status for clinicians who may employ ctDNA in their precision oncology programs. In this work, we take a step back from the intricate coverage of detection approaches described extensively elsewhere and cover basic concepts around the practical implementation of next generation sequencing (NGS)-guided liquid biopsy. We compare relevant targeted and untargeted approaches to plasma DNA analysis, describe the latest evidence for clinical validity and utility, and highlight the value of genome-wide ctDNA analysis, particularly as it relates to early detection strategies and discovery applications harnessing the non-coding genome. Conclusions The maturation of liquid biopsy for clinical application will require interdisciplinary efforts to address current challenges. However, patients and clinicians alike may greatly benefit in the future from its incorporation into routine oncology care.