Abstract: Due to the advantages of easy synthesis, structural stability and low immunogenicity, peptides represent one of the most popular molecules in the field of drugs and medical materials in the past few decades. However, their clinical translation remains hindered by issues such as poor bioavailability and a short half-life resulting from enzymatic degradation. Addressing these limitations is crucial for bridging the gap between basic research and clinical application. In situ self-assembly of peptides refers to as the processes for manipulating the covalent interactions and further organization of peptides into nanostructures at targeting sites. It allows for precise regulation of the structural features of peptide nanostructures, thus offering a method to overcome delivery biological barriers. In addition, the ordered assembly gives rise to some impressive effects on modulating the association between peptides and targets. Therefore, in situ assembly of peptides serves as a burgeoning research topic for development of peptide-based biomaterials. To address the challenges for developing peptide biomedical materials, this review summarizes the progress recently achieved by our group focusing on intracellular controllable assembly of peptides into theranostic agents with enhanced delivery efficiency and bioactivity. We first introduce the underlying mechanism for manipulating peptide assembly, with an emphasis on the stimulus-responsive reactions, such as hydrolysis and redox reactions. Subsequently, we discuss the establishment of complex assembly systems in living cells to optimize the bioactivity of peptides. Eventually, recent strategies for developing functional materials for biomedical applications are briefly highlighted. We also provide our forward conceiving perspectives on the challenges in the development of in situ assembly in living cells to demonstrate its great potential in creating biomaterials for healthcare in the future.