SARS-CoV-2 is a positive-sense RNA virus and it is the causative agent of the global COVID-19 outbreak. COVID-19 is similar to the previous outbreaks for instance SARS in 2002-2003 and MERS in 2012. As the peptides have many advantages, peptide-based therapeutics might be one of the possible ways in the development of COVID-19 specific drugs. SARS-CoV-2 enters into a human via its S protein by attaching with human hACE2 present on the cell membrane in the lungs and intestines of humans. hACE2 cleaves S protein into the S1 subunit for viral attachment and the S2 subunit for fusion with the host cell membrane. The fusion mechanism forms a six-helical bundle (6-HB) structure which finally fuses the viral envelope with the host cell membrane. hACE2 based peptides such as SBP1 and Spikeplug have shown their potential as antiviral agents. S protein-hACE2 interaction and the SARS-CoV-2 fusion machinery play a crucial part in human viral infection. It is evident that if these interactions could be blocked successfully and efficiently, it could be the way to find the drug for COVID-19. Several peptide-based inhibitors are potent inhibitors of S protein-hACE2 interaction. Similarly, the antiviral activity of the antimicrobial peptide, lactoferrin makes it an important candidate for the COVID-19 drug development process. A candidate drug, RhACE2-APN01 based on recombinant hACE2 peptide has already entered phase II clinical trials. This review sheds light on different aspects of the feasibility of using peptide-based therapeutics as the promising therapeutic route for COVID-19.