As a type of magnetic device being able to realize contact‐free power transmission together with sufficient volumetric torque density, the field‐modulated magnetic gear (FMMG) has become a promising alternative to the mechanical gear having rigid construction yet suffering lots of issues generated by the continuous teeth friction. The conventional magnetic gears (MGs) that behave as simple copies of their mechanical counterparts and can be roughly defined as origination of the FMMG are briefly introduced at first. Subsequently, the topology and material advancements proposed to improve operational performance of the FMMG are comprehensively summarised so as to clarify its current development status. Finally, potential applications of the FMMG due to its inherent advantages are compared against the existent challenges. The review aims to provide referable guidelines for researchers working at the field of high‐performance MGs.