Efficient luminescent materials are key requisites for modern lighting and display devices. Typically, they rely on optical down-conversion of incident high-energy radiation to photons of lower energy. Since the energy of a vacuum ultraviolet (VUV) photon is more than twice that of a visible photon, it is theoretically possible to split such a VUV photon into two visible photons, yielding a hypothetic quantum yield (QY) of up to 200%. Such two- (or more) photon luminescence phenomena have been refered to as quantum cutting (QC), quantum splitting (QS), or photon cascade emission (PCE). Near-infrared (NIR) QC via down-conversion phenomena have hence been studied in numerous materials recently, particularly for RE<sup>3+</sup>/Yb<sup>3+</sup> (RE=Tb, Tm, Pr, Er, Nd and Ho)-codoping. However, in most of those cases where NIR luminescence originates from Yb<sup>3+</sup> through a first-order energy transfer from RE<sup>3+</sup>, QC does actually not occur. Despite the importance of the issue, it appears that there is presently no report on NIR- QS (especially three-photon NIR-QS) in a single-ion activated material. As a consequence, the main mechanisms responsible for NIR-QS not well understood. The present paper reviews on the recent progress made on materials and developments in the fields of NIR-QC phosphors and the mechanism involved, including the observation of sequential two-photon and three-photon NIR-QS in single RE ion activated phosphors, and NIR-QC in dual/ternary RE ions activated phosphors via downconversion. In addition, applications, challenge and future advances of the QC phosphors have also been dealt with.