The healthcare industry has witnessed a significant shift towards the use of real-world data (RWD) and real-world evidence (RWE) in medical decision-making and treatment evaluation. This article explores the importance of RWE in healthcare decision-making and its potential to revolutionise drug development, regulatory processes, and patient care. We examined the US FDA’s strategic vision for RWD and RWE, tracing the agency’s evolving stance from early 2000s to present day. The FDA’s framework for RWE, key guidance documents, and the establishment of the Center for Real-World Evidence Innovation are discussed. Case studies illustrate RWE’s role in supporting regulatory decisions, including safety labelling changes and label expansions. We conclude by discussing the future of RWE, including its integration with artificial intelligence and its importance in evaluating cell and gene therapies, emphasising its transformative impact on healthcare innovation and regulatory processes.