The estimation of the state of health (SOH) of lithium-ion batteries is a critical technology for enhancing battery lifespan and safety. When estimating SOH, it is essential to select representative features, commonly referred to as health indicators (HIs). Most existing studies primarily focus on HIs related to capacity degradation and internal resistance increase. However, due to the complexity of lithium-ion battery degradation mechanisms, the relationships between these mechanisms and health indicators remain insufficiently explored. This paper provides a comprehensive review of core methodologies for SOH estimation, with a particular emphasis on the classification and extraction of health indicators, direct measurement techniques, model-based and data-driven SOH estimation approaches, and emerging trends in battery management system applications. The findings indicate that capacity, internal resistance, and temperature-related indicators significantly impact SOH estimation accuracy, while machine learning models demonstrate advantages in multi-source data fusion. Future research should further explore composite health indicators and aging mechanisms of novel battery materials, and improve the interpretability of predictive models. This study offers theoretical support for the intelligent management and lifespan optimization of lithium-ion batteries.