Well cementing is an important operation during drilling and completion of oil wells. The cement sheath must maintain well integrity behind the casing and provide long-term zonal isolation to ensure safety and prevent environmental problems. Despite recent technological advancement in smart polymeric materials, fibers and self-healing materials, it is still a big challenge to provide adequate long-term zonal isolation in severe oil well conditions. This review provides an overview of challenges faced in oil wells compromising the long-term ability of the cement sheath to provide zonal isolation. Factors controlling the long-term performance of cement sheath are discussed, in terms of shrinkage, tensile strength and flexibility. The use of nanomaterials as cement additive to fabricate flexible, high-tensile strength, and low-shrinkage cement system are reviewed.Introduction of nanomaterials into the cement system is a promising approach to design a sealant for the entire life of the well, thereby avoiding potential remedial costs and environmental impacts.