Seawater electrolysis is a promising approach for sustainable hydrogen production that could alleviate the ever-growing demand for freshwater resources. This literature review synthesizes current research on direct seawater electrolysis, drawing attention to advances in electrode materials, catalyst efficiency, and system design. Furthermore, an overview of indirect seawater electrolysis is given as a benchmark. Key challenges, including electrode corrosion, chlorine evolution and energy efficiency, are critically analysed. Recent innovations in selective catalysts and membrane technologies are discussed as potential solutions for such challenges. The review also evaluates the economic feasibility of direct seawater electrolysis compared with the established traditional electrolysis using desalinated water. There is currently no research or industrial project demonstrating clear benefits of using direct seawater electrolysis over indirect seawater electrolysis. Our findings, however, do suggest that direct seawater electrolysis can become a viable component of the hydrogen economy for specific target applications.