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Refrigerant substitution is an urgent need in the context of reducing carbon emissions and slowing global warming. CO2 is now being proposed as a promising solution based on its excellent properties and system performance, especially in low-temperature environments. This paper presents an overview of recent advances in system configuration and operation characteristics to improve the performance of transcritical CO2 heat pump and refrigeration systems. The paper first introduces the basic research background, system cycle, and thermodynamic characteristics. Secondly, CO2 cycle improvements with single modifications and modification combinations are reviewed. Then, some important operation characteristics and control methods are discussed. Additionally, the paper provides a detailed description of the development of transcritical CO2 heat pump and refrigeration systems in the vehicle field. At the end of this review, conclusions and opportunities for future work in this field are presented.