Energy consumption in the world is increasing faster than its generation. Deterioration of air quality in major cities around the world has reached alarming level and requires drastic measures to improve it. It is estimated that the existing fossil fuels reserves will be available for only another few decades. Many researchers claimed that the solution to all these global problems would be to replace the existing fossil fuel system with the clean hydrogen energy system. Hydrogen is a very efficient and clean fuel. Its combustion is free from greenhouse gases and ozone layer depleting chemicals. Hydrogen has been recognized as a fuel having some unique and highly desirable properties, for application as a fuel in engines. Its ability to burn cleanly and operate efficiently is owed to the unique combustion characteristics that allow ultra-lean combustion with dramatically reduced NOx production and efficient low-engine load operation. Despite having advantages, it also faces some technical challenges which include pre-ignition, backfire, knocking and increased NOX production at higher loading condition. Backfire and pre-ignition has been recognized as the most important phenomenon that occurs in hydrogen fuelled internal combustion engine (H2ICE). This happens because of the wide flammability range, low ignition energy, rapid combustion speed and shorter quenching distance of the hydrogen fuel. This mistimed combustion problem is mostly dependent on the type of injection, injection pressure, equivalence ratio and ignition timings. Various methods have been adopted to avoid the problem of pre-ignition which includes injecting cold exhaust gases into the cylinder, injecting cold gaseous hydrogen, injecting water into the cylinder, increasing the compression ratio and, using lean burn carburetor. So, despite having benefits in H2ICE, efforts have been put to achieve reduction of NOx formation and emissions, advanced control and optimization strategies to achieve highly efficient engine. A new research and development of advanced Hydrogen engine will be mentioned in the review.