Overcoming the mechanical disparities between implantable neural electrodes and biological tissue is crucial in mitigating immune responses, reducing shear motion, and ensuring durable functionality. Emerging hydrogel-based neural interfaces, with their volumetric capacitance, customizable conductivity, and tissue-mimicking mechanical properties, offer a more efficient, less detrimental, and chronically stable alternative to their rigid counterparts. Here, we provide an overview of the exceptional advantages of hydrogels for the development of next-generation neural interfaces and highlight recent advancements that are transforming the field.