Two‐dimensional (2D) transition metal dichalcogenides (TMDs) have garnered significant attention in gas‐sensing applications due to their sensitive response to a wide range of gas molecules and their ability to operate at low temperatures, resulting in low‐power consumption. However, there are several areas that require improvement, including insufficient sensitivity at low detection limits, limited gas selectivity, low reliability, and poor recovery. To address these issues and enhance the performance of gas sensors, researchers have proposed the functionalization and hybridization of 2D TMDs. This review paper focuses on elucidating the synergistic effects of functionalization and hybridization of 2D TMDs with carbon‐related materials, metals, MOs, and metal chalcogenides. The paper presents an in‐depth analysis of the mechanisms involved in enhancing the performance of 2D TMD gas sensors and explores various synthesis methods for achieving functionalization and hybridization. Furthermore, the challenges currently faced in the field are discussed and offer insights into the future prospects of TMD nanocomposite‐based gas sensors. By comprehensively addressing these aspects, this research aims to contribute to the advancement of gas‐sensing technology using TMD nanocomposites.