Properties such as superior specific strength, being imponderous, and the ability to reprocess are the key features that have drawn attention to magnesium. In the last few years, applications such as automotive, aerospace, and medical applications have been seeking light-weight equipment, and light-weight materials are required for making them. These demands were matched by developing metal matrix composites with magnesium as a base and reinforced with carbon nanotubes (CNTs), grapheme nanoplatelets (GNPs), or ceramic nanoparticles. CNTs have been adopted for developing high-strength metal matrix composites (MMCs) because of their delicately superior thermal conductivity, surface-to-volume ratio, and tensile strength, but lower density. In developing high-performance light-weight magnesium-based MMCs, a small number of CNTs result in refined properties. However, making Mg-based MMCs has specific challenges, such as achieving uniform reinforcement distribution, which directly relates to the processing parameters. The composition of CNT, CNT sizes, their uniform distribution, Mg-CNT interfacial bonding, and their in-between alignment are the characteristic deciding factors of Mg-CNT MMCs. The current review article studies the modern methods to develop Mg-CNT MMCs, specifications of the developed MMCs, and their vital applications in various fields. This review focuses on sifting and summarizing the most relevant studies carried out on the methods to develop Mg-CNT metal matrix composites. The article consists of the approach to subdue the tangled situations in highlighting the Mg-CNT composites as imminent fabrication material that is applicable in aerospace, medical, and automotive fields.