Dry powder inhalers have become increasingly attractive for pulmonary delivery of locally and systemically effective medications. In comparison to the liquid counterparts, such as nebulisation and pressurised metered dose inhalers, the powder form generally offers better chemical stability, improved portability and potentially superior patient adherence. Currently, the aerosol performance between dry powder inhalers varies to a large extent due to differences in the design of inhaler device and formulation. The particulate properties have a significant influence on the inter-particle interactions, which impacts on the aerosolisation of the inhaled powder. In this review, critical particulate properties that affect aerosol performance are discussed. Recent advances in powder production and particle engineering techniques are also assessed, aiming to develop new inhaled powder formulations or improve the aerosolisation efficiency of existing products.