<p>Extended finite element method (XFEM) has been popularly used among researchers for fracture analysis of materials as it overcomes the need for conformal meshing and thus reduces computational time when compared to the conventional finite element method. While XFEM offers advantages in specific applications, such as crack propagation in complex geometries, it is not without limitations. This review emphasizes the applications of XFEM based on the type of materials (piezoelectric, functionally graded materials and composites), geometrical domains (plates, shells and pipes), discontinuities, nature of fracture and loading conditions (dynamic and thermo-mechanical loadings). It also discusses the challenges associated with XFEM, including the need for specific implementations, handling multiple and intersecting cracks, and the lack of constitutive behavior generality. This review also elucidates the research gaps from past literature which will help the upcoming researchers and scientists working for the advancement in the field of fracture mechanics. Literature shows that there is scarcity of work on the utilization of XFEM to determine the dynamic fracture behavior of functional materials like fibre-reinforced polymer composites, concretes, refractory high entropy alloys, and ceramics under creep and fatigue conditions.</p>