The rapid commercialization of lithium batteries greatly promotes the development of the electric vehicles, renewable energy storage systems and consumer electronics. The service lifetime and safety of lithium batteries are extremely concerned by terminal customers. Sensor technology is powerful in monitoring the physical and chemical signals of lithium batteries, serving for the state of health and safety warning/evaluation of lithium batteries and guide for future development of battery materials. In this review, the primary concern is the generation mechanisms of different physicochemical signals in lithium batteries. Then, the sensing methods and sensing designs according to different physicochemical signals of lithium batteries is summarized. Finally, some perspectives are provided to guide further development of sensing technology for lithium batteries. This review will greatly accelerate the terminal application of advanced sensors, whether in commercial products or scientific research.