Two‐phase heat transfer is widely used in the heat transfer field, for example, condenser and evaporator in the refrigeration system, riser, and condenser in thermal power plants, and so on. The advantage of two‐phase heat transfer is that it gives a very‐high convective heat transfer coefficient compared to other modes of heat transfer. Nanofluid is a comparatively new heat transfer fluid and very popular because of its improved thermophysical properties. If nanofluid is used in a two‐phase heat transfer field, then the convective heat transfer coefficient may improve further. Nanofluids are possibly useful in many studies in two‐phase heat transfer like pool boiling heat transfer, flow boiling heat transfer, nanofluids in a microchannel, forced convective heat transfer, condensation, spray cooling, enhanced oil recovery, and so on. The effect of nanoparticles on wettability, contact angle, and nucleation sites are also reviewed in this paper. Numerical studies in two‐phase heat transfer are also reviewed and summarized in this paper. In this review, the chronological development of heat transfer in the two‐phase field is provided in a tabular form. This table covers a wide period starting Before Common Era ages until the recent addition of nanoparticles in the two‐phase heat transfer fluid.