Amidst the global shortfalls in blood supply, storage limitations of donor blood and the availability of potential blood substitutes for transfusion applications, society has pivoted towards in vitro generation of red blood cells (RBCs) as a means to solve these issues. Many conventional research studies over the past few decades have found success in differentiating hematopoietic stem and progenitor cells (HSPCs) from cord blood, adult bone marrow and peripheral blood sources. More recently, techniques that involve immortalization of erythroblast sources have also gained traction in tackling this problem. However, the RBCs generated from human induced pluripotent stem cells (hiPSCs) still remain as the most favorable solution due to many of its added advantages. In this review, we focus on the breakthroughs for high-density cultures of hiPSC-derived RBCs, and highlight the major challenges and prospective solutions throughout the whole process of erythropoiesis for hiPSC-derived RBCs. Furthermore, we elaborate on the recent advances and techniques used to achieve cost-effective, high-density cultures of GMP-compliant RBCs, and on their relevant novel applications after downstream processing and purification.