The efficiency of perovskite solar cells (PSCs) has risen rapidly over the past decade, and it has already crossed the 25% mark. However, stability has long been the bottleneck toward the commercialization of these devices. Perovskite is inherently vulnerable to moisture, high temperature, UV light, and other environmental factors, which naturally come in contact during operation. Moreover, degradation of the device is also associated with the hole transport layer (HTL), electron transport layer (ETL), and buffer layers. The mechanisms for PSCs’ physical, chemical, structural, and environmental instabilities are discussed critically herein, along with recent efforts made by various groups to overcome these stability issues. Comparison is made among different engineering techniques to stabilize the devices. Moreover, the lack of unified criteria for stability tests of PSCs is discussed. Different degradation mechanisms are collated and compared and recent approaches of different groups on stability analysis from a neutral point of view are critically evaluated. Finally, this review urges future research to focus on novel materials for different layers which are reasonably lattice matched and stable with perovskite layer and use suitable encapsulation techniques for proper sealing of the device against degrading substances.