The present work is focused on friction stir welding and friction stir processing of dissimilar alloys due to its emerging technique applied in the wide area of applications viz., aviation, ship building, defence industries etc. In recent years, the novel solid-state joining techniques viz., friction stir welding and friction stir processing are applied in joining of dissimilar alloys even though there is the difference in mechanical properties and chemical composition of the alloys. Due its eco-friendly, versatile and energy-efficient process, these are implemented to reduce the harmful effects and formation of defects in joining of dissimilar alloys compared to the fusion welding techniques. The specially designed non-consumable rotating tools are used in joining process by generating frictional heat between the tool surface and alloys to produce the sound welds. This work discusses the status, opportunities and challenges of above processes in joining of dissimilar alloys, viz., aluminium, steels, titanium etc.