Abstract: Electrowetting as the most promising microfluidic manipulation technique, has been a hot research topic and shows attractive potential in various optofluidic applications, such as optical filters, micro lens, lab on a chip, printing, optical fiber, and reflective displays, etc. In the present review, we give an overview of the basic theory of electrowetting. The differences and applicable features of the mainstream academic point of views, including energy minimization, thermodynamic approach and electromechanical method are compared. The dynamic description of electrowetting system based on overall energy balance approach or hydrodynamic method, and the mechanism of dynamics instability in electrowetting are fully discussed. The challenges and potential research directions in the field of electrowetting fundamental theory and its dynamics instability have been highlighted.