The rising popularity of drones significantly impacts package delivery services, offering both unique opportunities and challenges. This survey explores the diverse applications of drones for last-mile deliveries, highlighting their capacity to access remote areas and create new business prospects. Use cases, ranging from critical medical deliveries to addressing COVID-19 pandemic needs, underscore the transformative potential of drone technology. While recognizing drones’ eco-friendly attributes in eliminating harmful gas emissions, the survey addresses battery constraints, necessitating an investigation into physical energy models to extend flight autonomy. This becomes crucial for operational capabilities, especially in adverse weather conditions. A reliable communication infrastructure is crucial for the success of drone operations in package delivery, especially during unexpected events, as seamless connectivity plays a key role in facilitating efficient control and monitoring between ground stations and drones. This enables dynamic rerouting, enhancing overall delivery reliability. The survey explores innovative approaches, including collaborations with other vehicles like trucks, trains, and buses, optimizing the last-mile delivery process. Despite the transformative potential, concerns about privacy, security, safety, and risk management in drone delivery are acknowledged. The work also emphasizes responsible and ethical implementation, considering diverse concerns associated with widespread adoption. In contrast to existing survey articles focused on specific technical aspects, this comprehensive survey broadens its scope. It covers ethical issues, sustainability aspects, healthcare systems, physics models, innovative approaches, reliable communications, security and safety concerns, and real test-beds in drone-based delivery systems. The survey not only identifies potential applications and tackles technical challenges but also integrates broader considerations. In addition, this work extensively explores the motivations, lessons learned, and future directions in the realm of drone delivery. Analyzing existing literature, it provides valuable insights for researchers, industry professionals, policymakers, and stakeholders keen on understanding the dynamic evolution of drone technology in the package delivery domain.