ZrO2 ceramic exhibits the characteristics of high hardness, good thermochemical stability, desirable biocompatibility, and unique stress‐activated tetragonal to monoclinic transformation toughening, thus having broad development prospects. However, as a typical ceramic material, it has the common shortcoming of brittleness and seriously limits the possible applications. In recent years, worldwide efforts have been made to improve the toughness of ZrO2 ceramic materials, which has great significance in promoting its industrial application. Herein, the influences of phase composition, stabilizer, grain size, and sintering method on fracture toughness of ZrO2 ceramic are introduced. The mechanism of phase transformation toughening, single‐phase and multiphase material dopant toughening, and lamellar ceramic toughening are also summarized. Moreover, the prevailing applications of toughened ZrO2‐based materials in structural ceramics, coatings, and biomaterials are discussed. The present review may offer insights in designing and fabricating ZrO2 materials with high strength and toughness to provide better performances in diverse applications fields.