The metal-catalyzed successive activation and functionalization of arene/heteroarene is one of the most fundamental transformations in organic synthesis and leads to privileged scaffolds in natural products, pharmaceuticals, agrochemicals, and fine chemicals. Particularly, transition-metal-catalyzed C–H functionalization of arenes with carbene precursors via metal carbene migratory insertion has been well studied. As a result, diverse carbene precursors have been evaluated, such as diazo compounds, sulfoxonium ylides, triazoles, etc. In addition, there have been significant developments with the use of iodonium ylides as carbene precursors in recent years, and these reactions proceed with high efficiencies and selectivities. This review provides a comprehensive overview of iodonium ylides in C–H functionalizations, including the scope, limitations, and their potential synthetic applications.