An increasing number of promising immunotherapies and related clinical trials have led to several major breakthroughs in multiple cancers, but a reliable and precise biomarker for evaluating efficacy and prognosis has not yet been established. As a typical representation of a liquid biopsy, circulating cell-free DNA (ctDNA) possesses the functions and advantages of tissue biopsy but its distinct advantages of convenience, real-time nature, non-invasiveness and homogeneity make it superior to tissue biopsy. Indeed, compared with routine imaging and tumor markers, ctDNA offers an earlier indication and provides more precise information. ctDNA is reportedly able to identify immunotherapy responders, evaluate efficacy and survival time, screen immune checkpoint inhibitor resistance and pseudo-progress and predict tumor recurrence and metastasis. Thus, ctDNA can act as an "Eagle Eye" by comprehensively monitoring both macro- and micro-changes in the immunotherapy process. Although ctDNA has become a research topic of interest, its limitations cannot be ignored, and improvements in its sensitivity and standardization are urgently needed. This review reveals the advantages and limitations of ctDNA as a precise biomarker and supports the feasibility of using ctDNA detection for common monitoring during immunotherapy.