People with bipolar disorder frequently experience persistent residual symptoms, problems in psychosocial functioning, cognitive impairment, and poor quality of life. In the last decade, the treatment target in clinical and research settings has focused not only on clinical remission, but also on functional recovery and, more lately, in personal recovery, taking into account patients’ well-being and quality of life. Hence, the trend in psychiatry and psychology is to treat bipolar disorder in an integrative and holistic manner. This literature review offers an overview regarding psychosocial functioning in bipolar disorder. First, a brief summary is provided regarding the definition of psychosocial functioning and the tools to measure it. Then, the most reported variables influencing the functional outcome in patients with bipolar disorder are listed. Thereafter, we include a section discussing therapies with proven efficacy at enhancing functional outcomes. Other possible therapies that could be useful to prevent functional decline and improve functioning are presented in another section. Finally, in the last part of this review, different interventions directed to improve patients’ well-being, quality of life, and personal recovery are briefly described.