<p>Energy consumption has escalated considerably, but fossil fuel sources are depleting and under investigation for their environmental impact. Consequently, renewable resources such as solar energy are gaining popularity; yet, their intermittent nature creates challenges that require effective storage solutions. Phase change material (PCM)-based solar thermal energy storage (STES) systems can revolutionize climate change mitigation and energy storage; however, PCMs’ low thermal conductivity restricts STES effectiveness. To address these challenges, researchers are experimentally and numerically investigating various innovative approaches to boosting the thermal performance of PCMs, including the incorporation of nano-additives. Therefore, this review explored the strategies of improving STES systems’ efficiency by carefully studying the effect of nanoparticle-enhanced PCM (NEPCM) on their thermophysical characteristics, charging and discharging rates, and overall performance. This work has synthesized prior research outcomes, emphasizing numerical analysis as a foundation for the experimental investigation, enabling other researchers to address the existing research gap by validating the findings for practical implementation. This paper encompasses information regarding the contemporary trend of NEPCM utilization, selection criteria, synthesis mechanisms, computational tools, techno-economic implications, and a unique flowchart for the development of a STES system. Research findings reveal that carbon-based nanomaterials of optimum size and concentration demonstrate considerable performance; however, challenges such as elevated material prices, agglomeration, and instability during thermal cycles impede their widespread application. By surmounting challenges such as the cost-effective and green production of nanoparticles, their surface modification, and integration into metal foam, the deployment of NEPCM-based STES devices can be expedited.</p>