Due to the merits of simple structure and high efficiency, the Stirling engine has been considered to have great potential since its invention. This paper provides a literature review on the Stirling engine’s recent advancement in models, configurations and analysis methods. Applications of Stirling engines under the overall background of global warming, pollution and space exploration are also covered. Some basic knowledge about the Stirling engine, such as history, basic configurations and theories are also introduced. The objective of this research is to assess the Stirling engine’s value in today’s society and stimulate inspiration for future development so as to make full use of the Stirling engine’s advantages. The conclusion is that many advancements of the Stirling engine are still being proposed, and future applications of the Stirling engine are still promising, especially when humanity is now facing so many problems that have posed threats to people’s health and the natural environment. Some possible future developments are mentioned in the conclusion for further discussion in the future.