Context: Learning analytics is considered as the third wave in educational technology and it is a new and promising field of study. This study was conducted to clarify benefits and challenges of learning analytics in education. Methods: Cooper's systematic literature review was used as the research method. This method has five steps as follows: a) formulation of the problem, b) collection of data, c) evaluation of the appropriateness of the data, d) analysis and interpretation of relevant data, and e) organization and presentation of the results. Based on the study selection process, 36 articles were finally selected to be analyzed. Results: The results showed that ethics and privacy were one of the most important challenges of learning analytics in education along with the lack of attention to theoretical foundations and scope and quality of data. The results also showed that learning analytics could bring remarkable benefits for education, such as increased engagement of students, improvement of learning outcomes, identification of students at risk, providing real-time feedback, and personalization of learning. Conclusions: Based on the results, it can be concluded that learning analytics offer new insights in education, however, there are ethical, educational, and technical issues in the use of learning analytics in education.