PD-1/PD-L1 axis represents an important target for renormalizing and resetting anti-tumor immunity in cancer patients. Currently, anti-PD-1/PD-L1 therapy has been applied in a broad spectrum of tumors and has yielded durable remission in patients. However, how to further broaden the application, guide personalized therapeutic strategies, and improve clinical responses remains a vital task. At present, PD-L1 expression is an important parameter of clinical indications for immune checkpoint blockade in many types of cancers, a strategy based on the supposition that positive PD-L1 expression reflects local T cell response. Recent studies have revealed that PD-L1 expression is regulated by multiple layers of complicated factors, during which the host immune microenvironment exerts a pivotal role and determines the clinical efficacy of the therapy. In this review, we will summarize recent findings on PD-1/PD-L1 in cancer, focusing on how local immune landscape participates in the regulation of PD-L1 expression and modification. Importantly, we will also discuss these topics in the context of clinical treatment and analyze how these fundamental principles might inspire our efforts to develop more precise and effective immune therapeutics for cancer.