Recent technological advances in conventional planar and microstructured solar cell architectures have significantly boosted the efficiencies of these devices near the corresponding theoretical values. Nanomaterials and nanostructures have promising potential to push the theoretical limits of solar cell efficiency even higher using the intrinsic advantages associated with these materials, including efficient photon management, rapid charge transfer, and short charge collection distances. However, at present the efficiency of nanostructured solar cells remains lower than that of conventional solar devices due to the accompanying losses associated with the employment of nanomaterials. The concurrent design of both optical and electrical components will presumably be an imperative route toward breaking the present-day limit of nanostructured solar cells. This review summarizes the losses in traditional solar cells, and then discusses recent advances in applications of nanotechnology to solar devices from both optical and electrical perspectives. Finally, a rule for nanostructured solar cells by concurrently engineering the optical and electrical design is devised. Following these guidelines should allow for exceeding the theoretical limit of solar cell efficiency soon.