Nonthermal processing methods are often preferred over conventional food processing methods to ensure nutritional quality. Nonthermal plasma (NTP) is a new field of nonthermal processing technology and seeing increased interest for application in food preservation. In food applications of NTP, liquid interactions are the most prevalent. The NTP reactivity and product storability are altered during this interaction. The water activated by NTP (plasma‐activated water [PAW]) has gained considerable attention during recent years as a potential disinfectant in fruits and vegetable washing. However, detailed understanding of the interactions of NTP reactive species with food nutritional components in the presence of water and their stability in food is required to be explored to establish the potential of this emerging technology. Hence, the main objective of this review is to give a complete overview of existing NTP–liquid interactions. Further, their microbial inactivation mechanisms and the effects on food quality are discussed in detail. Most of the research findings have suggested the successful application of NTP and PAW for microbial inactivation and food preservation. Still, there are some research gaps identified and a complete analysis of the stability of plasma reactive species in food is still missing. By addressing these issues, along with the available research output in this field, it is possible that NTP can be successfully used as a food decontamination method in the near future.