Cavity phase matching (CPM) is a method of compensating for phase mismatch based on reflection phase shifts in resonant microcavities and can ensure efficient optical frequency conversion in nonlinear media within one coherent length. Compared with an optical parametric oscillator (OPO) based on birefringent phase matching and quasi-phase matching, a microcavity optical parametric oscillator (MOPO) based on CPM is compact, simple, flexible, and applicable to various nonlinear crystals, in addition to exhibiting unique spectral properties. Recently, MOPO theory and technology have been continuously developing. High-efficiency MOPO devices with different operation modes that can generate widely tunable or broadband laser outputs have been developed. Simulation results indicate that this technology can potentially generate monochromatic terahertz waves. Thus, MOPO devices are promising, novel light sources for integrated optics and micro-opto-electro-mechanical systems. This study introduces the basic principle of CPM, analyzes the operating characteristics of an MOPO, summarizes the developments, and outlines the prospects such type of device.