Multicomponent reactions (MCRs) have paved their way as highly reliable tool in contemporary chemistry, serving not only as an atom economic version but also as an efficient one‐pot protocol in the synthesis of various pharmaceutically relevant heterocycles. This review article seeks to present a comprehensive overview of the significant heterocyclic ring formations facilitated by multicomponent cascade reactions, namely Ugi, Biginelli, Passerini, and other reactions. This review also highlights recent advancements over the past decade in the application of classical and modern MCRs—such as the Ugi, Biginelli, Passerini, and domino‐type reactions—for the construction of nitrogen‐, oxygen‐, and sulfur‐containing heterocycles of pharmaceutical and materials relevance. Additionally, the biological relevance of the heterocycles is discussed, offering insights into the synthetic utility and functional importance of MCR‐derived frameworks. Besides, this review article is dedicated to deliver in depth mechanistic insights and authoritative presentation and critical comments on crucial reactions.