Based on air-, water-, and ground-source heat pump systems, a novel type of heat pump system, named the heat-source tower heat pump system (HSTHPS), has recently been developed in the southern area of China. The HSTHPS overcomes the evaporator frosting problems of the air-source heat pump system (ASHPS) when the ambient temperature is lower, and it avoids the geological condition constraints of the water- and ground-source heat pump systems. However, studies on the HSTHPS are insufficient, thereby limiting its development and applications. Thus, the present review provides a detailed literature review on the advancements of HSTHPSs in China, including the HSTHPS operation principle, heat-source tower (HST) structure, heat and mass transfer characteristics, HSTHPS performance, antifreeze solution use, and antifreeze solution regeneration. Studies on the heat and mass transfer characteristics of HSTs are sufficient for guiding the application. Regarding open systems, the solution drifting to the air needs to resolved, and future studies need to focus on structure optimization for heat exchangers in closed systems. Moreover, advanced defrosting technology should be applied to closed-type HSTs, and a suitable operation strategy for HSTHPSs should be developed. Future priorities should involve integrating HSTHPSs with additional renewable energy in order to achieve continuous, stable, and efficient heating in winter based on the characteristics of local climate and renewable energy.