Handling complexity in conceptual ship design processes requires a thorough understanding of complexity aspects in general. More than 100 scientific papers on the subject published since 1962 are, therefore, reviewed and discussed in this paper. The paper expands the understanding of complexity theory by reviewing the literature in the engineering domain. Different definitions of complexity, characteristics of complex systems, aspects of complexity in design, complexity sources, and its drivers are explored and discussed in detail. Furthermore, the findings are arranged into relevant complexity factors in ship design. Related complexity factors in ship design, are also discussed by use of examples from everyday ship design practices. This study is a theoretical elaboration to shed light on the current practice and future research direction in handling complexity in conceptual ship design processes to improve competitiveness.