Dynamic pricing plays an important role in modern Intelligent Transportation System (ITS) in solving problems such as congestion control, peak load reduction, mobility management of traditional or Electric Vehicles (EVs) in cost-effective manner. It also facilitates the construction of an eco-friendly environment in the society by optimized route planning of vehicles. However, framing dynamic pricing strategies for ITS has always been a challenging task keeping in view of various constraints. An in-efficient dynamic pricing technique may lead to the mismanagement of vehicles, which results an increase in the waiting time of vehicles, an increase in air and noise pollution, wastage of electric and other sources of energies. On the contrary, efficient dynamic pricing strategies can provide satisfaction to all stakeholders, including service providers and service consumers. Motivated from these facts, this paper presents an extensive literature review and analysis of dynamic pricing techniques used in the literature for ITS. The analysis presented in the paper gives new insights to the readers for the applications of one of the techniques in comparison to its merits over the others. Various problems solved by the dynamic pricing techniques, importance of various evaluation parameters, limitations of dynamic pricing techniques and their applications are discussed in-depth in this paper. Different taxonomies used for exploring various issues of dynamic pricing are also presented in a structured manner. Moreover, advantages and limitations of various dynamic pricing techniques are explored and discussed in the paper. Finally, existing challenges and future research directions of dynamic pricing in ITS are presented.