ABSTRACT Parasocial interaction (PSI) and parasocial relationship (PSR) are important and widespread phenomena in both offline and online marketing. While extensive, prior work on PSI and PSR is riddled with inconsistencies and needs an updated perspective. First, research needs to establish whether and why PSI and PSR represent different concepts with unique characteristics. Furthermore, the conceptualization of PSI and PSR remains predominantly rooted in offline contexts, despite the shift in media consumption toward online platforms. By systematically reviewing 233 peer‐reviewed journal articles published between 1956 and 2023, this study provides a nuanced perspective on the evolution of PSI and PSR in offline and online environments. Theoretically, it contributes to the literature by proposing seven key criteria to differentiate PSI from PSR in offline and online contexts, as well as offering new conceptualizations of PSI and PSR in the online environment. Using the Theories–Characteristics–Contexts–Methods (TCCM) framework, this work presents a comprehensive overview of the current state of research and discusses future research directions.