When developing and evaluating psychometric measures, a key concern is to ensure that they accurately capture individual differences on the intended construct across the entire population of interest. Inaccurate assessments of individual differences can occur when responses to some items reflect not only the intended construct but also construct‐irrelevant characteristics, like a person's race or sex. Unaccounted for, this item bias can lead to apparent differences on the scores that do not reflect true differences, invalidating comparisons between people with different backgrounds. Accordingly, empirically identifying which items manifest bias through the evaluation of differential item functioning (DIF) has been a longstanding focus of much psychometric research. The majority of this work has focused on evaluating DIF across two (or a few) groups. Modern conceptualizations of identity, however, emphasize its multi‐determined and intersectional nature, with some aspects better represented as dimensional than categorical. Fortunately, many model‐based approaches to modelling DIF now exist that allow for simultaneous evaluation of multiple background variables, including both continuous and categorical variables, and potential interactions among background variables. This paper provides a comparative, integrative review of these new approaches to modelling DIF and clarifies both the opportunities and challenges associated with their application in psychometric research.