AbstractDiabetes significantly impairs the body's wound‐healing capabilities, leading to chronic, infection‐prone wounds. These wounds are characterized by hyperglycemia, inflammation, hypoxia, variable pH levels, increased matrix metalloproteinase activity, oxidative stress, and bacterial colonization. These complex conditions complicate effective wound management, prompting the development of advanced diabetic wound care strategies that exploit specific wound characteristics such as acidic pH, high glucose levels, and oxidative stress to trigger controlled drug release, thereby enhancing the therapeutic effects of the dressings. Among the solutions, hydrogels emerge as promising due to their stimuli‐responsive nature, making them highly effective for managing these wounds. The latest advancements in mono/multi‐stimuli‐responsive smart hydrogels showcase their superiority and potential as healthcare materials, as highlighted by relevant case studies. However, traditional wound dressings fall short of meeting the nuanced needs of these wounds, such as adjustable adhesion, easy removal, real‐time wound status monitoring, and dynamic drug release adjustment according to the wound's specific conditions. Responsive hydrogels represent a significant leap forward as advanced dressings proficient in sensing and responding to the wound environment, offering a more targeted approach to diabetic wound treatment. This review highlights recent advancements in smart hydrogels for wound dressing, monitoring, and drug delivery, emphasizing their role in improving diabetic wound healing. It addresses ongoing challenges and future directions, aiming to guide their clinical adoption.