With continuous efforts of researchers all over the world, the field of inertial microfluidics is constantly growing, to cater to the requirements of diverse areas like healthcare, biological and chemical analysis, materials synthesis, etc. The scale, automation, or unique physics of these systems has been expanding their scope of applications. In this review article, we have provided insights into the fundamental mechanisms of inertial microfluidics, the forces involved, the interactions and effects of different applied forces on the suspended particles, the underlying physics of these systems, and the description of numerical studies, which are the prime factors that govern designing of effective and practical devices.. Further, we describe how various forces lead to the migration and focusing of suspended particles at equilibrium positions in channels with different cross-sections and also review various factors affecting the same. We also focus on the effect of suspended particles on the flow of fluids within these systems. Furthermore, we discuss how Dean flows are created in a curved channel and how different structures affect the creation of secondary flows, and their application to mixing, manipulating, and focusing particles as fluid. Finally, we describe various applications of microfluidics for diagnostic and other clinical purposes, and discuss the challenges and advancements in this field. We anticipate that this manuscript will elucidate the basics and quantitative aspects of inertial fluid dynamic effects for application in biomedicines, materials synthesis, chemical process control, and beyond.