Solar light harvesting and conversion to useful energy are the most important tasks for overcoming the world energy crisis. The design of advanced materials for solar light conversion requires focused research to obtain efficient photocatalytic systems. Photogenerated charge carrier separation is a crucial prerequisite in applications such as photo‐electrochemical water splitting, photovoltaics, and photocatalytic dye degradation. Interfacial charge‐transfer (IFCT) plays a significant role in electron–hole separation considering the energy barriers of the energy levels at semiconductor–semiconductor, semiconductor–metal, semiconductor–molecule, and semiconductor–electrolyte interfaces. Both electron and hole transport across the interface via IFCT, with comparable rates, are important for maintaining enhanced photocatalytic efficiency and stability of the catalysts. The key focus of this article is to understand the charge transfer processes at the interface and the relationship between photogenerated charge separation and photocatalytic activity. The interfacial charge transfer in different interfaces is discussed, along with the fundamentals of IFCT in photo‐electrochemical processes; semiconductor heterojunctions with materials having proper band alignment and offer new ways to design multifunctional photocatalysts are also disucssed. The charge transfer process from semiconductor to catalyst molecules and dye molecules to semiconductor is explained in detail.