Lamellar transition‐metal dichalcogenides (MX2) have promising applications in electrochemical energy storage and conversion devices due to their two‐dimensional structure, ultrathin thickness, large interlayer distance, tunable bandgap, and transformable phase nature. Interlayer engineering of MX2 nanosheets with large specific surface area can modulate their electronic structures and interlayer distance as well as the intercalated foreign species, which is important for optimizing their performance in different devices. In this review, a summary on recent progress of MX2 nanosheets and the significance of their interlayer engineering is presented firstly. Synthesis of interlayer‐expanded MX2 nanosheets with various strategies is then discussed in detail. Emphasis is focused on their applications in rechargeable batteries, pseudocapacitors, hydrogen evolution reaction (HER) catalysis and treatments of environmental contaminants, demonstrating the importance of interlayer engineering on controlling performance of MX2. The current challenges of the interlayer‐expanded MX2 and outlooks for further advances are finally discussed.