<p>Coacervation is a liquid–liquid phase separation process in polyelectrolyte solutions induced by environmental factors such as pH, ionic strength, temperature, and solubility. This process results in the formation of a colloid-rich phase known as a coacervate. Their formation is governed by an equilibrium among van der Waals forces, hydrogen bonding, hydrophobic interactions, electrostatic interactions, and other weak forces. Rheological analysis provides insights into the balance of these interactions. The properties of coacervates can be controlled by adjusting parameters such as pH, polymer ratio, ionic strength, and the molecular characteristics of polyelectrolytes. Based on formation mechanism and rheological analysis, coacervates have significant potential for various applications, including melt extrusion products, electrospinning, underwater adhesives, and saloplastic materials. This review provides a comprehensive overview of coacervates, including their definition, internal structure, theoretical models, coacervation mechanisms, controlling factors, applications, and rheological behavior.</p>