The Dunning-Kruger effect is a cognitive bias in which people mistakenly evaluate their ability in a given task. This is especially true for unskilled individuals, who often overestimate their ability, and sometimes even falsely rate their ability much higher than average. On the other hand, more competent individuals often underestimate themselves. For unskilled performers, the inability to recognize their incompetence is due to the metacognition deficiency, while for the most competent performers, the false-consensus effect makes them unable to perceive their ability precisely. Different explanations for this phenomenon have been given from different perspectives, such as regression to the mean and better-than-average heuristic, nature of the task and motivational factors. Besides, factors like egocentric nature, anchoring and insufficient adjustment heuristic, social feedback, and chronic self-concept may also affect one’s self-evaluation. The future research about Dunning-Kruger effect should focus more on research scope, experimental paradigm, error control, cultural difference, its influence on psychological adaption and performance, and so on.