New technologies rely on the development of new materials, and these may simply be the innovative combination of known components. The structural combination of a polymer hydrogel network with a nanoparticle (metals, non‐metals, metal oxides, and polymeric moieties) holds the promise of providing superior functionality to the composite material with applications in diverse fields, including catalysis, electronics, bio‐sensing, drug delivery, nano‐medicine, and environmental remediation. This mixing may result in a synergistic property enhancement of each component: for example, the mechanical strength of the hydrogel and concomitantly decrease aggregation of the nanoparticles. These mutual benefits and the associated potential applications have seen a surge of interest in the past decade from multi‐disciplinary research groups. Recent advances in nanoparticle–hydrogel composites are herein reviewed with a focus on their synthesis, design, potential applications, and the inherent challenges accompanying these exciting materials.