The Internet of Things (IoT) has rapidly expanded for a wide range of applications towards a smart future world by connecting everything. As a result, new challenges emerge in meeting the requirements of IoT applications while retaining optimal performance. These challenges may include power consumption, quality of service, localization, security, and accurate modeling and characterization of wireless channel propagation. Among these challenges, the latter is critical to establishing point-to-point wireless communication between the sensors. Channel modeling also varies depending on the features of the surrounding area, which have a direct impact on the propagation of wireless signals. This presents a difficult task for network planners to efficiently design and deploy IoT applications without understanding the appropriate channel model to analyze coverage and predict optimal deployment configurations. As a result, this challenge has attracted considerable interest in academic and industrial communities in recent years. Therefore, this review presents an overview of current breakthroughs in wireless IoT technologies. The challenges in such applications are then briefly reviewed, focusing on wireless channel propagation modeling and characterization. Finally, the study gives a generalized form of commonly used channel models and a summary of recent channel modeling developments for wireless IoT technology. The outcome of this review is expected to provide a new understanding of the propagation behavior of present and future wireless IoT technologies, allowing network engineers to undertake correct planning and deployment in any environment. Additionally, the study may serve as a guideline for future channel modeling and characterization studies.