Artificial Intelligence (AI) is considered to be a vital innovation in English language education by providing learners with personalized and interactive learning opportunities. Among the various applications of artificial intelligence (AI) in language education, its role in supporting the development of paraphrasing skills has gained increasing attention. Regarding English as a Foreign Language (EFL) learners, paraphrasing becomes a vital academic writing skill that involves conveying the same message through different lexical choices and syntactic structures while retaining the original meaning. However, many EFL learners find this process challenging due to limited vocabulary, grammatical challenges, and insufficient writing experience. AI-powered writing tools offer immediate feedback, vocabulary alternatives, grammar support, and sentence reformulation, allowing students to practice paraphrasing more effectively. This literature review indicates recent studies on the use of AI in improving EFL students' paraphrasing skills. The findings recommend that AI enhances writing accuracy, learner autonomy, and confidence while supporting the development of academic writing. Nevertheless, responsible AI use and teacher guidance stay essential to ensure academic integrity and meaningful learning outcomes.