The paramount concerns of global warming, fossil fuel depletion, and energy crises have prompted the need of hydrocarbons productions via CO2 conversion. In order to achieve global carbon neutrality, much attention needs to be diverted towards CO2 management. Catalytic hydrogenation of CO2 is an exciting opportunity to curb the increasing CO2 and produce value‐added products. However, the comprehensive understanding of CO2 hydrogenation is still a matter of discussion due to its complex reaction mechanism and involvement of various species. This review comprehensively discusses three processes: reverse water gas shift (RWGS) reaction, modified Fischer Tropsch synthesis (MFTS), and methanol‐mediated route (MeOH) for CO2 hydrogenation to hydrocarbons. It is also very important to understand the real‐time evolvement of catalytic process and reaction intermediates by employing in‐situ characterization techniques. Subsequently, in second part of this review, we provided a systematic analysis of advancements in in‐situ techniques aimed to monitor the evolution of catalysts during CO2 reduction process. The section also highlights the key components of in‐situ cells, their working principles, and applications in identifying reaction mechanisms for CO2 hydrogenation. Finally, by reviewing respective achievements in the field, we identify key gaps and present some future directions for CO2 hydrogenation and in‐situ studies.