Friction stir welding (FSW) began as a fairly specialized joining method, but over the past three decades it has evolved into something considerably more versatile, a manufacturing platform that now handles complex multi-material assemblies and solid-state additive processes with reasonable reliability. This review follows this evolution, paying particular attention to friction stir additive manufacturing (FSAM) and the persistent difficulties that arise when joining dissimilar systems: aluminum to steel or metals to polymers, where the fate of the joint is largely decided by how well the intermetallic compounds are kept under control. Machine learning, artificial intelligence, and high-fidelity numerical models are reducing the reliance on trial-and-error that once dominated parameter selection and defect prediction, bringing FSW closer to the operating principles of Industry 4.0. Hybrid variants, including ultrasonically assisted and underwater FSW, are also receiving attention here, as they offer researchers finer control over heat generation and plastic flow than the standard process allows. Throughout the study, microstructural observations are directly connected to mechanical results, with the aim of analyzing the current state of solid-state manufacturing and identifying the questions that most urgently need answering.