Cutaneous leishmaniasis (CL) is caused by female sandflies carrying the protozoan parasite Leishmania, which is a vector-borne disease. There are 12 million cases overall with an annual incidence of 2–2.5 million. CL is classified by the World Health Organization as a category 1 emerging and uncontrolled disease and as a seriously neglected disease. Because of the significant clinical diversity and overlap across the Leishmania species, none of the clinical manifestations are specific to a single species, despite the fact that each may have its own peculiar signs and areas of endemicity. This is due to the fact that factors pertaining to both the host and the Leishmanian species that induce infection affect the clinical picture. These include the parasite's virulence, infectiousness, hematogenous and lymphatic dissemination, immunological response, and host genetic susceptibility. It used to be quite difficult to identify the infecting parasite, but new DNA techniques have made it reasonably easy to identify the Leishmania species, allowing for a more informed choice of therapy. The recent advancements in the diagnosis of cutaneous leishmaniasis (CL), which is brought on by both Old and New World Leishmania species, are the main topic of this review.