Thyroid nodules are extremely common and can be detected by sensitive imaging in more than 60% of the general population. They are often identified in patients without symptoms who are undergoing evaluation for other medical complaints. Indiscriminate evaluation of thyroid nodules with thyroid biopsy could cause a harmful epidemic of diagnoses of thyroid cancer, but inadequate selection of thyroid nodules for biopsy can lead to missed diagnoses of clinically relevant thyroid cancer. Recent clinical guidelines advocate a more conservative approach in the evaluation of thyroid nodules based on risk assessment for thyroid cancer, as determined by clinical and ultrasound features to guide the need for biopsy. Moreover, newer evidence suggests that for patients with indeterminate thyroid biopsy results, a combined assessment including the initial ultrasound risk stratification or other ancillary testing (molecular markers, second opinion on thyroid cytology) can further clarify the risk of thyroid cancer and the management strategies. This review summarizes the clinical importance of adequate evaluation of thyroid nodules, focuses on the clinical evidence for diagnostic tests that can clarify the risk of thyroid cancer, and highlights the importance of considering the patient’s values and preferences when deciding on management strategies in the setting of uncertainty about the risk of thyroid cancer.