Summary Objective To systematically review evidence on genetic risk factors for carbamazepine (CBZ)–induced hypersensitivity reactions (HSRs) and provide practice recommendations addressing the key questions: (1) Should genetic testing for HLA‐B*15:02 and HLA‐A*31:01 be performed in patients with an indication for CBZ therapy to reduce the occurrence of CBZ‐induced HSRs? (2) Are there subgroups of patients who may benefit more from genetic testing for HLA‐B*15:02 or HLA‐A*31:01 compared to others? (3) How should patients with an indication for CBZ therapy be managed based on their genetic test results? Methods A systematic literature search was performed for HLA‐B*15:02 and HLA‐A*31:01 and their association with CBZ‐induced HSRs. Evidence was critically appraised and clinical practice recommendations were developed based on expert group consensus. Results Patients carrying HLA‐B*15:02 are at strongly increased risk for CBZ‐induced Stevens‐Johnson syndrome/toxic epidermal necrolysis (SJS/TEN) in populations where HLA‐B*15:02 is common, but not CBZ‐induced hypersensitivity syndrome (HSS) or maculopapular exanthema (MPE). HLA‐B*15:02–positive patients with CBZ‐SJS/TEN have been reported from Asian countries only, including China, Thailand, Malaysia, and India. HLA‐B*15:02 is rare among Caucasians or Japanese; no HLA‐B*15:02‐positive patients with CBZ‐SJS/TEN have been reported so far in these groups. HLA‐A*31:01–positive patients are at increased risk for CBZ‐induced HSS and MPE, and possibly SJS/TEN and acute generalized exanthematous pustulosis (AGEP). This association has been shown in Caucasian, Japanese, Korean, Chinese, and patients of mixed origin; however, HLA‐A*31:01 is common in most ethnic groups. Not all patients carrying either risk variant develop an HSR, resulting in a relatively low positive predictive value of the genetic tests. Significance This review provides the latest update on genetic markers for CBZ HSRs, clinical practice recommendations as a basis for informed decision making regarding the use of HLA‐B*15:02 and HLA‐A*31:01 genetic testing in patients with an indication for CBZ therapy, and identifies knowledge gaps to guide future research. A PowerPoint slide summarizing this article is available for download in the Supporting Information section here.