Supercapacitors, often referred to as Ultracapacitors, are electrochemical energy storage devices with high power density and moderate energy storage which serves as a bridge between the conventional capacitors and batteries. While conventional capacitors offer extreme power but negligible energy and batteries provide high energy density for long-term storage, Supercapacitors fill the gap between these technologies. By combining the rapid charge-discharge characteristics of conventional capacitors with comparatively enhanced energy storage capability associated with electrochemical systems, supercapacitors become highly suitable for applications that require substantial power delivery over short time interval. These distinct abilities of supercapacitors offer exceptional cycle stability, operational reliability and long service durability. The review focuses on the use of supercapacitors in power density and long cycle life applications, such as quick acceleration and regenerative braking in HEVs, power management in HESS, and battery-less electric vehicle technology based on supercapacitors with ultra-fast charging capabilities. In this paper, a comprehensive review of supercapacitor technology is presented, including the working principle, classification, materials, characteristics, and latest developments in supercapacitor technology. Moreover, the review critically discusses the applications of supercapacitors, such as RBS and HESS, along with the current challenges, limitations, and future research avenues for the betterment of supercapacitor technology.