Wide bandgap oxide semiconductors constitute a unique class of materials that combine properties of electrical conductivity and optical transparency. They are being widely used as key materials in optoelectronic device applications, including flat‐panel displays, solar cells, OLED, and emerging flexible and transparent electronics. In this article, an up‐to‐date review on both the fundamental understanding of materials physics of oxide semiconductors, and recent research progress on design of new materials and high‐performing thin film transistor (TFT) devices in the context of fundamental understanding is presented. In particular, an in depth overview is first provided on current understanding of the electronic structures, defect and doping chemistry, optical and transport properties of oxide semiconductors, which provide essential guiding principles for new material design and device optimization. With these principles, recent advances in design of p‐type oxide semiconductors, new approaches for achieving cost‐effective transparent (flexible) electrodes, and the creation of high mobility 2D electron gas (2DEG) at oxide surfaces and interfaces with a wealth of fascinating physical properties of great potential for novel device design are then reviewed. Finally, recent progress and perspective of oxide TFT based on new oxide semiconductors, 2DEG, and low‐temperature solution processed oxide semiconductor for flexible electronics will be reviewed. Wide‐bandgap oxide semiconductors uniquely combine electrical conductivity and optical transparency and are widely used in optoelectronic devices. The materials physics of wide‐bandgap oxide semiconductors, the recent progress in the design of new materials and novel thin‐film transistor (TFT) devices, and current challenges and perspectives are reviewed.