The eXtended finite element method (XFEM) is a powerful tool for structural mechanics, assisting engineers and designers in understanding how a material architecture responds to stresses and consequently assisting the creation of mechanically improved structures. The XFEM method has unraveled the extraordinary relationships between material topology and fracture behavior in biological and engineered materials, enhancing peculiar fracture toughening mechanisms, such as crack deflection and arrest. Despite its extensive use, a detailed revision of case studies involving XFEM with a focus on the applications rather than the method of numerical modeling is in great need. In this review, XFEM is introduced and briefly compared to other computational fracture models such as the contour integral method, virtual crack closing technique, cohesive zone model, and phase-field model, highlighting the pros and cons of the methods (e.g., numerical convergence, commercial software implementation, pre-set of crack parameters, and calculation speed). The use of XFEM in material design is demonstrated and discussed, focusing on presenting the current research on composites and biological and bioinspired materials, but also briefly introducing its application to other fields. This review concludes with a discussion of the XFEM drawbacks and provides an overview of the future perspectives of this method in applied material science research, such as the merging of XFEM and artificial intelligence techniques.