Flying Ad-Hoc Networks (FANETs) are groups of UAVs connected in an Ad-Hoc manner to accomplish a common mission. The widespread acceptance of UAVs due to their low cost and high efficiency has attracted malicious security attacks against them. These attacks cannot be easily prevented due to UAVs’ limited computational power, short battery life, and inability to execute complex algorithms. FANETs rely on the Global Positioning System (GPS) for localization. GPS Spoofing, an easy-to-launch attack, is one of the main challenges in FANETs. In which, the legitimate and not-encrypted civilian GPS signals are overridden by counterfeit signals to deceive the UAVs to collide or to be hijacked. Researchers proposed various countermeasures to address GPS Spoofing attacks in FANETs. To further assist future research, this paper provides a systematic literature review on GPS Spoofing attacks in FANETs and their defense mechanisms. After formulating eight research questions and applying well-defined inclusion/exclusion criteria and quality assessment tools, 70 research articles were extracted. The existing defense mechanisms were classified based on their objectives (i.e., detection, mitigation, and/or prevention) and according to their basis (i.e., relying on readings from various drones’ devices/sensors, processing the signals received by various sensors, employing machine learning algorithms, relying on game theory, or leveraging cryptographic techniques to authenticate and protect the confidentiality of GPS signals). The defense mechanisms were also analyzed to identify the attacker models, impacts of the attack, and detection performance. This study found that most of the proposed methods are detection approaches, rather than mitigation or prevention. Also, almost all papers used simulation experiments rather than a proof-of-concept implementation, which does not demonstrate a convincing performance under realistic mobility and propagation models. Moreover, most solutions addressed GPS Spoofing for a single UAV. Only eight articles addressed multiple UAV scenarios and none of them provided a proof-of-concept evaluation.