Steel slag is a by-product of the steel industry and usually contains a high amount of f-CaO and f-MgO, which will result in serious soundness problems once used as a binding material and/or aggregates. To relieve this negative effect, carbonation treatment was believed to be one of the available and reliable methods. By carbonation treatment of steel slag, the phases of f-CaO and f-MgO can be effectively transformed into CaCO3 and MgCO3, respectively. This will not only reduce the expansive risk of steel slag to improve the utilization of steel slag further but also capture and store CO2 due to the mineralization process to reduce carbon emissions. In this study, based on the physical and chemical properties of steel slag, the carbonation mechanism, factors affecting the carbonation process, and the application of carbonated steel slag were reviewed. Eventually, the research challenge was also discussed.