The safe and reliable operation of autonomous vehicles in complex and dynamic environments is heavily dependent upon exteroceptive and proprioceptive sensors. A LiDAR system generates accurate 3D point clouds, which are crucial for the detection, classification, and tracking of multiple targets. LiDAR data, however, presents significant challenges due to its density, noise, and varying sampling rates. In this study, various clustering and MTT techniques for LiDAR point clouds will be identified and classified within the context of autonomous driving to assess the state-of-the-art methods’ key challenges and their performances. We have categorized clustering and MTT methods used in AV applications, identified research gaps and challenges and analyzed existing algorithms and their challenges in detail. Researchers and practitioners in the field of autonomous driving will find this review to be a valuable resource.