Baking is one of the oldest and complex thermal process of food industry widely used in the manufacture of cereal-based foods such as bread, biscuits, cakes, rusks, etc. The baking process involves complex physical, chemical, and biochemical changes which collectively determined the product quality. This review paper presents a comprehensive overview of the baking process with emphasis on its fundamental mechanisms, including heat transfer, moisture migration, dough expansion, starch gelatinization, protein denaturation, crust formation, and browning reactions such as the Maillard reaction and caramelization. The role of raw ingredients and their functionality is also reviewed. The influence of critical process parameters such as baking temperature and baking time is also discussed. In addition, recent trends and developments in baking technology are highlighted.