In the last decade, interfacial solar steam generation (ISSG), powered by natural sunlight garnered significant attention due to its great potential for low-cost and environmentally friendly clean water production in alignment with the global decarbonization efforts. This review aims to share the knowledge and engage with a broader readership about the current progress of ISSG technology and the facing challenges to promote further advancements toward practical applications. The first part of this review assesses the current strategies for enhancing the energy efficiency of ISSG systems, including optimizing light absorption, reducing energy losses, harvesting additional energy, and lowering evaporation enthalpy. Subsequently, the current challenges faced by ISSG technologies, notably salt accumulation and bio-fouling issues in practical applications, are elucidated and contemporary methods are discussed to overcome these challenges. In the end, potential applications of ISSG, ranging from initial seawater desalination and industrial wastewater purification to power generation, sterilization, soil remediation, and innovative concept of solar sea farm, are introduced, highlighting the promising potential of ISSG technology in contributing to sustainable and environmentally conscious practices. Based on the review and in-depth understanding of these aspects, the future research focuses are proposed to address potential issues in both fundamental research and practical applications.