As the world faces increasing global challenges, innovation becomes crucial for creating a sustainable future. In the age of the Internet of Things (IoT) and Industry 5.0, emerging technologies such as Digital Twins and Extended Reality (XR) are showing promise in addressing these challenges. The article examines the concept of merging Digital Twins, which are virtual reproductions of actual assets, with technologies like Extended Reality (XR) and the Internet of Things (IoT), as well as its applications in optimizing processes, enhancing decision making, and decreasing waste in global enterprises. The convergence of digital twins with extended reality, IoT, and Industry 5.0 presents unprecedented opportunities for innovation in agriculture, healthcare, and industry. In healthcare, digital twins enable personalized treatments and simulations for surgical planning, while in agriculture, they optimize crop growth and resource utilization. In the industry, digital twins streamline production processes, predict maintenance needs, and reduce downtime. This comprehensive review delves into the present landscape, obstacles, and future prospects of digital twins, extended reality, and IoT in various industries, emphasizing the imperative of ongoing research and development to unlock the complete transformative potential of these technologies for a sustainable future in Industry 5.0.