Spinel oxides, with the general formula AB2O4, are a class of ternary transition metal compounds renowned for their diverse elemental composition and tunable electronic properties. Their cubic crystal structure, belonging to the Fd-3 m space group, features metal ions in both tetrahedral and octahedral coordination centers, which can be manipulated to achieve different catalytic functionalities. This review focuses on the impact of oxygen vacancies on the structural and catalytic properties of spinel oxides and the various strategies to introduce these vacancies. The formation of oxygen vacancies, facilitated through heat treatment, chemical reduction, etching, doping, and composite formation, has been shown to significantly enhance the conductivity, redox potential, and catalytic activity of spinel oxides. These vacancies act as active sites, promote electron/ion transfer, and lower activation energies for various catalytic reactions. Characterization techniques such as X-ray photoelectron spectroscopy (XPS), electron paramagnetic resonance (EPR), and density functional theory (DFT) calculations provide comprehensive insights into the distribution, concentration, and electronic structure modifications due to oxygen vacancies. Theoretical calculations, in particular, underscore the pivotal role of vacancies in stabilizing reaction intermediates and reducing energy barriers. This review synthesizes the current understanding of oxygen vacancies in spinel oxides and highlights the potential for defect engineering as a strategy to optimize catalysts for applications in energy storage, environmental catalysis, and electrochemical reactions.