The principal drivers that led to the high growth rate in the renewable energy market in developing countries over the past twenty years include not only the dwindling fossil reserves, exorbitant increase in the price of crude oil, widening energy deficit, but also the extravagant lifestyle of profligate consumers of energy. Nearly one-third of total primary energy is consumed for the purpose of space cooling and heating. Renewable and passive systems can reduce the building cooling and heating energy demand. Earth air tunnel heat exchanger system is one of the promising technique used for space cooling and heating nowadays, thus reduce fossil fuel based energy demand as well as greenhouse gas emission, but its use has been restrained owing to its poor performance, land area requirement and financial viability. Various experimental, analytical and simulation studies have been conducted in last few decades to investigate the various parameters that may enhance its performance. In this article, the effect of thermo-physical parameters of soil, thermal and flow parameters of air, geometrical and material properties of pipe, different modes of operation on the performance of earth air tunnel heat exchanger systems have been critically reviewed. Following thorough review of the articles, it is concluded that if EATHE system is developed with proper design guidelines, then it may facilitate sufficient space heating and cooling with significant energy savings.