Utilization of nanoparticles for enhanced oil recovery (EOR) has attracted great attention in recent decades. However, various constraints influence fluid-fluid and fluid-rock interactions of nanofluids and subsequently oil recovery. A comprehensive review of existing literatures on how to mitigate against these limits are presented in this study. Furthermore, nanofluid EOR mechanisms and various application parameters which may influence nanofluid flooding efficiency were discussed. Also, the basic steps for preliminary investigation of nanomaterials for EOR, the challenges, gaps, and future trends associated with nanofluids reservoir field applications were suggested. Field trials results have proven that nanofluids can influence various EOR mechanisms.