Supramolecular polysaccharide-based hydrogels have attracted considerable research interest recently due to their high structural functionality, low toxicity, and potential applications in foods, cosmetics, catalysis, drug delivery, tissue engineering and the environment. Modulation of the stability of hydrogels is of paramount importance, especially in the case of stimuli-responsive systems. This review will update the recent progress related to the rational design of supramolecular hydrogels with the objective of understanding the gelation process and improving their physical gelation properties for tailored applications. Emphasis will be given to supramolecular host–guest systems with reference to conventional gels in describing general aspects of gel formation. A brief account of the structural characterization of various supramolecular hydrogels is also provided in order to gain a better understanding of the design of such materials relevant to the nature of the intermolecular interactions, thermodynamic properties of the gelation process, and the critical concentration values of the precursors and the solvent components. This mini-review contributes to greater knowledge of the rational design of supramolecular hydrogels with tailored applications in diverse fields ranging from the environment to biomedicine.