Voids in polymer composites may arise from various sources such as entrapped air within compounded pelletized material, moisture, volatiles evolved during cure, or residual solvents. Voids, or bubbles, are formed in short‐fiber thermoplastic composites because of entrapment of air in the compounding and melt flow processing steps and as a result of uneven shrinkage due to temperature gradients involved in the solidification step by cooling. This article reviews theoretical and experimental studies dealing with void formation during melt flow compounding and processing of fiber‐reinforced thermoplastic composites. The mechanism of void formation during processing under various flow conditions and the methods used for the determination of void content in composites were reviewed. The mechanism of bubble formation in molten polymer is that of nucleation and growth by expansion in a viscous medium. Voids nucleate at fiber ends, and their content depends on the processing method and processing conditions, on fiber concentration, and on fiber length.