Droplets display many unique properties in soft solid matrices, leading to various fascinating phenomena. These phenomena have inspired multidisciplinary scientific designs involving both fundamental studies and application exploration in the fields of physics, mechanics, chemistry, materials, biology, and so on. These emerging researches are diverse, ranging from artificial trees to antifouling coatings, and have not been concluded from the viewpoint of their composite structures, that is, droplet-embedded soft materials. A comprehensive understanding of these structures will favor the designs of new systems with various predictable properties. We thus review the recent progress of this topic here. This contribution starts from the basic structural characteristics of the droplet-embedded soft materials in the introduction section, followed by the section describing the main fabrication methods to create droplets in soft materials. In the third part, we divide the reported examples into five categories based on the hydrophobicity of the droplets and the miscibility between droplets and matrices and discuss their properties.Afterward, the applications of these systems with droplets are discussed, including self-healing, antifouling surfaces, anticounterfeiting, radiative cooling, and so on. Finally, the promising developments and facing challenges of this topic are proposed. We envision that this review can deliver a comprehensive understanding of droplets in soft matrices and promote the development of this topic.