With the Fourth Industrial Revolution (Industry 4.0) and advances in digital technology, zero-defect manufacturing (ZDM) has become a transformative and attractive concept that has the potential to reshape the manufacturing landscape. In this structured literature review, recent developments in ZDM in the textile industry from 2004 to 2023 are examined, with a focus on detection, repair, prediction, and prevention. Through bibliometrics analysis and evaluation of the current situation of ZDM technology, four main shortcomings are highlighted, to be specific, limitations in automated defect detection, incomplete artificial intelligence (AI)-based repair strategies, restricted predictive research, and focused prevention mechanism. Meanwhile, open challenges that require urgent attention are explored, that is systematic ZDM strategy integration, data management complexity, and demand for flexible ZDM frameworks. To address these shortcomings and challenges, three further prospectives are proposed, including addressing research imbalance, vision for an integrated ZDM system, and evolutionary predictive models. These prospectives aim to advance the field and drive the holistic development of ZDM technologies in the textile industry by promoting a more intelligent production strategy with higher quality and less waste.