Over the last decade, energy demand from the power grid has increased significantly due to the increasing number of users and the emergence of high-power industries. This has led to a significant increase in global emissions with conventional energy generation. Therefore, the penetration of renewable energy resources into the power grid has increased significantly. Photovoltaic systems have become the most popular resources as their protentional is enormous, thus, the worldwide installed PV capacity has increased to more than 635 gigawatts (GW), covering approximately 2% of the global electricity demand. Power electronics are an essential part of photovoltaic generation; the drive for efficient power electronic converters is gaining more and more momentum. Presently, multilevel inverters (MLI) have become more attractive to researchers compared to two-level inverters due to their abilities to provide lower electromagnetic interference, higher efficiency, and larger DC link voltages. This paper reviews multilevel inverters based on their classifications, development, and challenges with practical recommendations in utilizing them in renewable energy systems. Moreover, PV systems with various maximum power point tracking (MPPT) methods have been extensively considered in this paper as well. The importance and the development of a modified multilevel inverter are also highlighted in this review. In general, this paper focuses on utilizing multilevel inverters for PV systems to motivate and guide society to focus on inventing an efficient and economical multilevel inverter that has the combined capabilities of these converters reported in the literature.