Recently, development in intelligent transportation systems (ITS) requires the input of various kinds of data in real-time and from multiple sources, which imposes additional research and application challenges. Ongoing studies on Data Fusion (DF) have produced significant improvement in ITS and manifested an enormous impact on its growth. This paper reviews the implementation of DF methods in ITS to facilitate traffic flow analysis (TFA) and solutions that entail the prediction of various traffic variables such as driving behavior, travel time, speed, density, incident, and traffic flow. It attempts to identify and discuss real-time and multi-sensor data sources that are used for various traffic domains, including road/highway management, traffic states estimation, and traffic controller optimization. Moreover, it attempts to associate abstractions of data level fusion, feature level fusion, and decision level fusion on DF methods to better understand the role of DF in TFA and ITS. Consequently, the main objective of this paper is to review DF methods used for real-time and multi-sensor (heterogeneous) TFA studies. The review outcomes are (i) a guideline of constructing DF methods which involve preprocessing, filtering, decision, and evaluation as core steps, (ii) a description of the recent DF algorithms or methods that adopt real-time and multi-sensor sources data and the impact of these data sources on the improvement of TFA, (iii) an examination of the testing and evaluation methodologies and the popular datasets and (iv) an identification of several research gaps, some current challenges, and new research trends.INDEX TERMS Intelligent transportation systems, traffic flow analysis, data fusion; real-time processing, multi-sensor, heterogeneous data, machine learning.