The implementation of high‐efficiency and high‐resolution displays has been the focus of considerable research interest. Recently, micro light‐emitting diodes (micro‐LEDs), which are inorganic light‐emitting diodes of size <100 µm2, have emerged as a promising display technology owing to their superior features and advantages over other displays like liquid crystal displays and organic light‐emitting diodes. Although many companies have introduced micro‐LED displays since 2012, obstacles to mass production still exist. Three major challenges, i.e., low quantum efficiency, time‐consuming transfer, and complex color conversion, have been overcome with technological breakthroughs to realize cost‐effective micro‐LED displays. In the review, methods for improving the degraded quantum efficiency of GaN‐based micro‐LEDs induced by the size effect are examined, including wet chemical treatment, passivation layer adoption, LED structure design, and growing LEDs in self‐passivated structures. Novel transfer technologies, including pick‐up transfer and self‐assembly methods, for developing large‐area micro‐LED displays with high yield and reliability are discussed in depth. Quantum dots as color conversion materials for high color purity, and deposition methods such as electrohydrodynamic jet printing or contact printing on micro‐LEDs are also addressed. This review presents current status and critical challenges of micro‐LED technology and promising technical breakthroughs for commercialization of high‐performance displays.