Biodegradable polymers play an important role in environmental concerns compared to non-biodegradable polymers. Polyvinyl alcohol (PVA) is a biodegradable polymer with film-forming properties with antimicrobial and antioxidant activities and are considered for numerous practical applications in the industry, like food packaging, pharmaceuticals, and so on. The synthesis of PVA with promising properties like rheology, morphology, and mechanical performance is significant from the application point of view in industrial sectors. It is vital to realize the drawbacks and promising prospects associated with PVA rheology, morphology, and mechanical properties and how to address the problems concerning these properties. The present review describes the contemporary advancement of numerous synthesis approaches of PVA-based composite films and their rheology, morphology, and mechanical properties. This comprehensive review offers a comprehensive discussion of various strategies to enhance the rheology, morphology, and mechanical properties of composite films. It emphasizes modifications using environmentally friendly materials such as nanoparticles, metal oxides, polymers, and others. Additionally, existing challenges and the potential for forthcoming advancements in the properties of such composite films are discussed. The correlation between the PVA-based composite films and their promising properties like rheology, morphology, and mechanical performance may provide a reference for new insights into their applications in industrial sectors.