Membrane distillation (MD) is a novel desalination technology that has potential to produce distilled quality water from high salinity brine streams. The driving force for MD is the vapor pressure difference across a hydrophobic membrane resulting in transfer of water vapor from hot to cold side. This vapor contacts a cold surface and condenses to produce distillate. This paper reviews recent and/or multi-year research programs that focused on MD pilot or field testing. The various investigations concluded that while MD can produce distilled water quality, the energy efficiency remains the key bottleneck for future deployment of MD. Membrane wetting and fouling also presents key challenges for desalination due to both the high salinity and the presence of organics in the feed water. The authors contacted several MD vendors requesting updates on their latest products and technology developments. MD vendors with innovative module designs, some of which promise a step change in performance, have recently emerged on the market. In addition to water desalination, MD has a wide range of industrial applications such as hydrogen sulfide removal, the treatment of wastewater from the pharmaceutical, metal finishing industries, direct sewer mining, oily wastewater, and water recovery from flue gas. This paper also reviews novel membrane chemistries with emphasis on membranes prepared by phase inversion and electrospinning techniques to which nanomaterials have been added. The primary objectives in adding various nanomaterials (e.g., carbon nanotubes, graphene, silicon dioxide, fluorinated compounds) are to increase hydrophobicity (to reduce wetting) and increase mass transfer rates (to increase flux and lower cost).