Micro power stations utilizing nuclear energy represent a transformative approach to decentralized energy generation, offering potential benefits in efficiency, sustainability, and reliability. This review examines the recent advancements and persistent challenges associated with nuclear micro power stations, with a focus on innovative reactor designs, fuel cycle optimization, safety measures, and integration with renewable energy systems. Through a comprehensive analysis of thirty studies published prior to December 2021, the review synthesizes findings on technological progress, regulatory developments, and economic feasibility, highlighting key breakthroughs and identifying areas requiring further research. The review discusses the evolution of nuclear micro‐reactor technology, emphasizing modular designs that enhance scalability and flexibility. It also evaluates the integration of advanced materials and digital control systems that improve operational performance and safety. Moreover, the review critically assesses the economic and policy challenges that hinder widespread adoption, including high capital costs, public perception, and regulatory complexities. In addition, the interplay between nuclear micro power stations and renewable energy sources is explored, with attention to hybrid systems that can provide resilient and sustainable energy solutions. By collating diverse perspectives from engineering, economics, and policy domains, this review offers a multidimensional understanding of nuclear micro power stations and outlines strategic recommendations for future research. Ultimately, the findings suggest that while significant progress has been made, coordinated efforts across technological innovation, regulatory reform, and public engagement are essential to fully realize the potential of nuclear micro power stations. This review contributes to advancement of sustainable energy solutions.