ABSTRACT T cell exhaustion represents a pivotal mechanism of immune escape in cancer, with its inherent heterogeneity and dynamic plasticity being key determinants of the variable responses and resistance to immune checkpoint inhibitors (ICIs). This review comprehensively delineates the multifaceted heterogeneity of exhausted T (T EX ) cells, tracing their developmental trajectory from precursor exhausted T (T PEX ) cells to terminally differentiated exhausted T (T EX ‐term ) cells. We highlight both distinct and shared exhaustion features across diverse cancer types and spatial niches within the tumor microenvironment. Furthermore, we examine the multi‐layer biomarkers that drive and define this state, including characteristic surface inhibitory receptors, core transcription factors, and metabolism‐associated molecules. Grounded in this mechanistic understanding, we discuss emerging therapeutic strategies aimed at reversing T cell exhaustion. These range from the optimized application of ICIs and rational combination therapies involving epigenetic or metabolic interventions, to next‐generation engineered cell therapies such as chimeric antigen receptor T cell (CAR‐T), T cell receptor‐engineered T cell (TCR‐T), and tumor‐infiltrating lymphocytes (TILs), alongside emerging modalities including oncolytic viruses and bispecific antibodies. Finally, we discuss prevailing challenges and future directions, emphasizing that deciphering the heterogeneous landscape of T EX cells, identifying precise biomarkers, and developing temporally controlled combination regimens are imperative to effectively reverse T cell exhaustion and broaden the therapeutic efficacy of cancer immunotherapy.