The closed greenhouse is an innovative crop system in the horticulture sector, integrating appropriate climate control equipment and optimized techniques to collect, store, and reuse solar energy for heating and/or cooling the greenhouse. This concept aims to improve the crop yield and quality with energy efficient and water-saving technologies. A specific focus on the opportunities of implementing closed greenhouses under arid climate conditions is detailed in this work. Guidelines for selecting appropriate techniques and design parameters are investigated, aiming for profitable and sustainable greenhouse production. This paper provides an overview of the design aspects of the closed greenhouse and a state of the art of its applications in arid areas. Firstly, the microclimate parameters, including temperature, relative humidity (RH), light intensity, and CO2 concentration are introduced. Then, an in-depth focus on the effects of these parameters on crop productivity, water, and energy efficiency are thoroughly discussed. Finally, the limitations of closed greenhouse applications are pointed out as opportunities for further research and development in this emerging agriculture field.