The ever increasing need for oil around the world has helped the offshore oil industry to grow tremendously in the last few decades. This growth has made it necessary for this industry to investigate and design new and improved drilling methods that increase the productivity and efficiency of the devices used in offshore applications. Shape memory alloys (SMA) are new materials that have great potential for significantly improving instruments used in this field. Remarkable properties, such as the shape memory effect (SME), corrosion resistance, and superelasticity, have compelled the use of SMAs in the oil industry. When the SME is correctly harnessed, this device can become a lightweight, solid state alternative to conventional hydraulic, pneumatic or motor based actuator systems. The SMA can also be used in deepwater valves, underwater connectors, seals and self-torquing fasteners. The phase transformation property enables the SMA to withstand erosive stresses, which is useful for minimizing the erosion of the downhole well bores. The conventional passive damping method suffers from various defects and limitations; however, using the superelasticity of the SMA, sufficient energy dissipation is possible. SMA actuators cannot be used for high frequency operations, however, SMA actuators remain better options for low frequency operations due to a high power density, a high fatigue life and controllable actuation as compared to their traditional counterparts, which are sometimes more expensive, less reliable and very bulky. The largest benefit comes from their potential to reduce human labor and maintenance time under the ocean. There is a growing research interest in this area, as reflected by the increasing number of related research papers and patents. This paper reviews the recent development and application of shape memory alloys in the offshore oil industry.