As a new class of magnetically driven active materials, magnetic shape memory (MSM) alloys show large strains of up to 10% in Ni2MnGa single crystal with a modulated martensitic structure. The magnetic field induced twin boundary motion can be exploited for actuators, sensors, and as it is an energy dissipating process, also for vibration damping devices. However, single crystals of Ni2MnGa are difficult to prepare and are inherently very brittle. One solution is the use of aligned MSM particles suspended in a stiffness‐matched polymer matrix. In this review, we focus on the preparation and characterization of textured NiMn‐based MSM composite. Essential issues, e.g., the criterion of polymer selection and the interface of MSM particles and polymer are discussed. Second aspect of the paper is to review recent developments in metamagnetic shape memory NiMn‐(In,Sn,Sb) systems which exhibit field‐driven multifunctional properties such as magnetocaloric effect, magnetoresistant change, magnetoelectricity, and thermoelectricity.