Congenital dislocation of the patella is a rare condition which manifests as a permanent and irreducible patella fixed on the lateral aspect of the femoral condyle, usually present at birth. This condition is to be distinguished from habitual or obligate dislocation, in which the patella dislocates and relocates from its normal position in the trochlear groove spontaneously with flexion and extension of the knee. Congenital dislocation of the patella is frequently associated with a flexion contracture at the knee, genu valgus, foot deformity and external tibial torsion, along with various conditions including arthrogryposis, Down syndrome, and nail-patella syndrome, among others. Surgical correction is the only definitive treatment for this condition, which typically includes lateral release, medial stabilization, distal patellar tendon realignment, and proximal extensor lengthening if needed. Outcomes following surgical correction are generally satisfactory, with an improvement in function, range of motion, and quality of life for patients. The aim of this paper is to review the current understanding of congenital and habitual dislocation of the patella and provide an updated overview of the diagnosis and surgical management of these conditions.