In this paper, we investigate the current state and development of personalized smart immersive extended reality environments (PSI-XR). PSI-XR has gained increasing traction across various fields such as education, entertainment, and healthcare, offering customized immersive experiences that address users’ personalized needs. This study performs a systematic literature review by collecting and analyzing related journal and conference papers in the domain. Following a comprehensive search across three databases, which yielded 1276 papers, a refined selection of 94 publications was made to conduct an in-depth analysis of cutting-edge research in the field of PSI-XR. This review focused on examining application domains, relevant technologies, and smart techniques, including artificial intelligence, with particular emphasis on advancements in personalization. The study provides insights into prospective advancements while also identifying the opportunities and challenges in this evolving field. This review is beneficial for both researchers and developers interested in exploring the state-of-the-art personalized perspective in a smart immersive extended reality environment.