Summary Refrigerants bearing high global warming potential (GWP) and ozone depletion potential (ODP) were outlawed or facing time‐beared permission under the Montreal (1987), Kyoto (1997) protocols, F‐Gas law (2015), Paris Accord (2016), and recent Kigali Amendment to Montreal Protocol (2019). In order to modify followed by the paradigm shift of existing heating and cooling systems, American Society of Heating, Refrigeration, and Air‐Conditioning Engineers (ASHRAE) envisaged natural and synthetic refrigerants (Synrefs) are under investigation globally. Carbon dioxide (CO2) is a popular natural refrigerant (Natref) replacing Synrefs used in commercial heating, ventilation, air conditioning, and refrigeration (HVAC&R) systems globally. A rampant rise is observed in markets of Asia (Japan and China), North America (the United States and Canada), the Australian continent, and Africa (South Africa) by reaching 20 000 CO2‐stores around the globe. The European markets are leading the utilization of CO2 in the heat pump, and refrigeration, CO2 based markets estimate 14% of the total food retail stores (400 m2). Japan is the second leading market of CO2 heat pump and refrigeration with more than 10 200 CO2 condensing units. CO2 transcritical systems have a share of more than 10% in only European market (large stores); however, their share is less than 10% of total stores in other major markets of the world. New pump and compressor‐driven transcritical CO2 systems integrate ejectors, condensers, and booster systems to reduce energy consumptions, enhance efficiency, efficacy, and coefficient of performance. This article reports a critical review of the CO2 based heating, cooling, and refrigeration system and presents updated literature along with barriers and challenges on commercial use of Natref‐based heating and cooling applications worldwide.