From the Guidelines

Nystatin is used to treat fungal infections, specifically candidiasis.

Nystatin is used to treat oropharyngeal candidiasis, with a recommended dosage of 100,000 U/mL, 4–6 mL 4 times daily, or 1–2 nystatin pastilles (200,000 U each) 4 times daily for 7–14 days 1.
It is also used as a prophylactic measure in kidney transplant recipients to prevent oral and esophageal candidiasis, due to its effectiveness without systemic absorption 1.
In addition, nystatin is used to treat candidiasis in HIV-infected children, with a recommended dosage of 4–6 mL orally 4 times daily, or 1–2 200,000 U flavored pastilles orally 4–5 times daily 1.

Nystatin is not recommended for invasive or severe fungal infections, as it is not systemically absorbed and may not be effective in these cases 1.
The use of nystatin should be guided by susceptibility testing and species identification, especially in cases of fluconazole-refractory disease 1.
Nystatin can be used as an alternative to other antifungal agents, such as clotrimazole and fluconazole, in certain cases 1.

From the FDA Drug Label

INDICATIONS AND USAGE Nystatin Oral Suspension, USP, is indicated for the treatment of candidiasis in the oral cavity.

Nystatin is used for the treatment of candidiasis in the oral cavity 2.

Nystatin is used to treat oral candidiasis, a fungal infection caused by Candida species 3, 4
It is commonly used as a topical antifungal agent to treat oral and dermal fungal infections 5, 4
Nystatin is also used to prevent fungal infections in immunocompromised patients, such as those undergoing chemotherapy or radiation therapy 4, 6
It can be used to treat denture stomatitis and reduce the colony-forming units of Candida species on dentures and palatal surfaces 3

Nystatin is available in various formulations, including suspensions, gels, and lozenges 3, 4, 7
Compounded preparations with nystatin can be made for oral and oromucosal administration, including viscous oromucosal suspensions, oral/oromucosal hydrogels, and oromucosal gelatine globules 7
Water-soluble nystatin derivatives and formulations are being developed to improve the drug's solubility and reduce its toxicity 5

Nystatin has been shown to be effective in treating oral candidiasis, with significant reductions in colony-forming units of Candida species 3
It has been found to be equally effective as photodynamic therapy in treating denture stomatitis and reducing Candida species 3
However, nystatin may not be as effective as other antifungal agents, such as fluconazole, in preventing invasive fungal infections and colonisation in immunocompromised patients 6