In the last decade, inertial microfluidics has attracted significant attention and a wide variety of channel designs that focus, concentrate and separate particles and fluids have been demonstrated. In contrast to conventional microfluidic technologies, where fluid inertia is negligible and flow remains almost within the Stokes flow region with very low Reynolds number (Re < 1), inertial microfluidics works in the intermediate Reynolds number range (~1 < Re < ~100) between Stokes and turbulent regimes. In this intermediate range, both inertia and fluid viscosity are finite and bring about several intriguing effects that form the basis of inertial microfluidics including (i) inertial migration and (ii) secondary flow. Due to the superior features of high-throughput, simplicity, precise manipulation and low cost, inertial microfluidics is a very promising candidate for cellular sample processing, especially for samples with low abundant targets. In this review, we first discuss the fundamental kinematics of particles in microchannels to familiarise readers with the mechanisms and underlying physics in inertial microfluidic systems. We then present a comprehensive review of recent developments and key applications of inertial microfluidic systems according to their microchannel structures. Finally, we discuss the perspective of employing fluid inertia in microfluidics for particle manipulation. Due to the superior benefits of inertial microfluidics, this promising technology will still be an attractive topic in the near future, with more novel designs and further applications in biology, medicine and industry on the horizon.