Polymer composites have opened a novel innovation phase in additive manufacturing (AM), and now lightweight, high-strength, and geometrical advanced components with tailored functionalities can be produced. The present study introduces advances in polymer composite materials and their integration into AM processes, particularly in rapidly growing industries such as aerospace, automotive, biomedical, and electronics. The embedding of cutting-edge reinforcement materials, such as nanoparticles, carbon fibers, and natural fibers, into polymer matrices enhances mechanical, thermal, electrical, and multifunctional properties. These material developments are combined with advanced fabrication techniques, including multi-material printing, in situ curing, and functionally graded manufacturing, which achieves accurate regulation of microstructures and properties. Furthermore, high-impact innovations such as smart polymer composites with self-healing or stimuli-responsive behaviors, the growing shift toward sustainable, bio-based composite alternatives, are driving progress. Despite significant advances, challenges remain in interfacial bonding, printability, process repeatability, and long-term durability. This review offers a comprehensive overview of current advancements and outlines future directions in polymer composite–based AM.