Microneedles (MNs) offer minimally-invasive access to interstitial fluid (ISF) - a potent alternative to blood in terms of monitoring physiological analytes. This property is particularly advantageous for the painless detection and monitoring of drugs and biomolecules. However, the complexity of the skin environment, coupled with the inherent nature of the analytes being detected and the inherent physical properties of MNs, pose challenges when conducting physiological monitoring using this fluid. In this review, we discuss different sensing mechanisms and highlight advancements in monitoring different targets, with a particular focus on drug monitoring. We further list the current challenges facing the field and conclude by discussing aspects of MN design which serve to enhance their performance when monitoring different classes of analytes.