Leaf area index (LAI) is a key parameter of vegetation structure in the fields of agriculture, forestry, and ecology. Optical indirect methods based on the Beer-Lambert law are widely adopted in numerous fields given their high efficiency and feasibility for LAI estimation. These methods have undergone considerable progress in the past decades, thereby making them operational in ground-based LAI measurement and even in airborne estimation. However, several challenges remain, given the requirement of increasing accuracy and new applications. Clumping effect correction attained significant progress for continuous canopies with non-randomly disturbed leaves while non-continuous canopies are rarely studied. Convenient and operational measurement of leaf angle distribution and woody components is lacked. Accurate and comprehensive validations are still very difficult due to the limitations of direct measurement. The introduction of active laser scanning technology is a driving force for addressing several challenges, but its three-dimensional information has not been fully explored and utilized. In order to update the general knowledge and identify the possible error source, this study comprehensively reviews the temporal development, theoretical framework, and issues of indirect LAI measurement, followed by current methods, instruments, and platforms. Latest methods and instruments are introduced and compared to traditional ones. Current challenges, recent advances, and future perspectives are discussed to provide recommendations for further research.