The widespread production and consumption of plastics is a pressing global issue that requires multifaceted approaches and solutions. In terms of recycling, one of the ways to repurpose waste plastics in the construction industry would be to utilize them for asphalt pavement-related applications. Although this approach can potentially provide a value-added recycling outlet for plastics, several challenges need to be resolved to maximize its usage to the highest possible extent. Based on this, the present review article provides a comprehensive background on the different pertinent aspects associated with the use of waste plastics in asphalt mixtures. Besides examining the mechanical performance of asphalt mixtures containing waste plastic, the associated environmental concerns and life cycle assessment related attributes are also thoroughly deliberated. In addition, the successful demonstration of this technology through field trials in several countries is also discussed. Some of the main challenges related to the use of plastics in asphalt mixtures include the variability of plastic properties and composition, which can influence its mechanical performance and associated environmental impact. In general, the incorporation of waste plastics using certain tailored approaches can adequately meet and even enhance the typical performance parameters of asphalt mixtures. However, the effect of plastics modified asphalt mixtures on fuming and microplastics release remains unclear and needs further research. Nevertheless, the increasing number of field trials and widespread interest from transportation agencies around the world indicate the likelihood for the adoption of this technique as a sustainable practice in the pavement industry.