Since the discovery of graphene, there has been increasing interest in two-dimensional (2D) materials. To realize practical applications of 2D materials, it is essential to isolate mono- or few-layered 2D nanosheets from unexfoliated counterparts. Liquid phase exfoliation (LPE) is the most common technique to produce atomically thin-layered 2D nanosheets. However, low production yield and prolonged process time remain key challenges. Recently, novel exfoliation processes based on microfluidics have been developed to achieve rapid and high yield production of few-layer 2D nanosheets. We review the primary types of microfluidic-based exfoliation techniques in terms of the underlying process mechanisms and the applications of the 2D nanosheets thus produced. The key challenges and future directions are discussed in the above context to delineate future research directions in this exciting area of materials processing.