Thin lithium‐metal foil is a promising anode material for next‐generation batteries due to its high theoretical specific capacity and low negative potential. However, safety issues linked to dendrite growth, low‐capacity retention, and short cycle life pose significant challenges. Also, practical lithium metal batteries need a negative‐to‐positive electrode ratio as close to 1:1 as possible, which can be achieved through limiting excess lithium or using an "anode‐free" metal battery design. However, both designs experience fast capacity fade due to the irreversible loss of active lithium in the cell, caused by the formation of the solid electrolyte interphase (SEI), dendrite formation and "dead lithium," ‐ refers to lithium that has lost its electronic connection to the anode electrode or current collector. The presence of dead lithium in batteries negatively affects their capacity and lifespan, while also raising internal resistance and generating heat. Additionally, dead lithium encourages the growth of lithium dendrites, which poses significant safety hazards. Within this fundamental review, we thoroughly address the phenomenon of dead lithium formation, assessing its origins, implications on battery performance, and possible strategies for mitigation. The transition towards environmentally friendly and high‐performance metal batteries could be accelerated by effectively tackling the challenge posed by dead lithium.