Bank retreat plays a fundamental role in fluvial and estuarine dynamics. It affects the cross‐sectional evolution of channels, provides a source of sediment, and modulates the diversity of habitats. Understanding and predicting the geomorphological response of fluvial/tidal channels to external driving forces underpins the robust management of water courses and the protection of wetlands. Here, we review bank retreat with respect to mechanisms, observations, and modeling, covering both rivers and (previously neglected) tidal channels. Our review encompasses both experimental and in situ observations of failure mechanisms and bank retreat rates, modeling approaches and numerical methods to simulate bank erosion. We identify that external forces, despite their distinct characteristics, may have similar effects on bank stability in both river and tidal channels, leading to the same failure mode. We review existing data and empirical functions for bank retreat rate across a range of spatial and temporal scales, and highlight the necessity to account for both hydraulic and geotechnical controls. Based on time scale considerations, we propose a new hierarchy of modeling styles that accounts for bank retreat, leading to clear recommendations for enhancing existing modeling approaches. Finally, we discuss systematically the feedbacks between bank retreat and morphodynamics, and suggest that to move this agenda forward will require a better understanding of multifactor‐driven bank retreat across a range of temporal scales, with particular attention to the differences (and similarities) between riverine and estuarine environments, and the role of feedbacks exerted by the collapsed bank soil.