There is a growing interest in engineering hydrogels for 3D tissue and disease models. The major motivation is to better mimic the physiological microenvironment of the disease and human condition. 3D tissue models derived from patients' own cells can potentially revolutionize the way treatment and diagnostic alternatives are developed. This requires development of tissue mimetic hydrogels with user defined and tunable properties. In this review article, a recent summary of 3D hydrogel platforms for in vitro tissue and disease modeling is given. Hydrogel design considerations and available hydrogel systems are summarized, followed by the types of currently available hydrogel models, such as bulk hydrogels, porous scaffolds, fibrous scaffolds, hydrogel microspheres, hydrogel sandwich systems, microwells, and 3D bioprinted constructs. Although hydrogels are utilized for a wide range of tissue models, this article focuses on liver and cancer models. This article also provides a detailed section on current challenges and future perspectives of hydrogel-based tissue models.