Ionic liquids (ILs) which are made up of cationic and anionic components can be designed to possess a definite set of properties. In this context, the term “designer solvents” has been used to demonstrate the potential of these environment-friendly ionic liquids in chemical reactions. Since these liquids are able to dissolve several transition metal complexes, they have often been employed in recent times in several catalytic reactions to enhance reaction rates and selectivities. The concept of “immobilized” liquids has been derived from supported liquid phase catalysts; the immobilization process transferring the desired catalytic properties of the liquids to solid catalysts could combine the advantages of ILs with those of heterogeneous support materials and various catalytically functional groups or active species. The immobilized functional ionic liquids (IFILs) capable to restrict many of the negative effects of the conventional ILs have successfully been used in various potent catalytic areas affording high catalytic activity. In this review, structural characteristics, properties and preparation of immobilized functional ionic liquids have been described and the results are compared with those of traditional ILs. Special emphasis has been paid to comprehend the mechanism of various catalytic processes using immobilized ionic liquids functionalized by different groups.