Cold spraying is a novel and versatile coating technique that receives more and more interest from both, industry and academia. In contrast to thermal spraying, cold spraying just uses the kinetic energy upon impact to assure bonding. Due to the resulting low process temperatures, any undesired side reactions and phase transformations in the spray powder are minimized. Moreover, heat-sensitive substrates, like polymers or light metal alloys, can be coated. Thus, cold gas spraying opens the opportunity to exploit new material combinations with unique properties for novel applications. For optimum spraying conditions and coating performance, a comprehensive understanding of the process and bonding mechanisms is required. Comparisons with related processes, like explosive powder compaction, and macroscopic impact experiments, as well as computer simulations visualize the bonding process and allow for extracting critical parameters. This presentation summarizes the current model for coating formation based on shear instabilities, which relates critical velocities to mechanical and thermal properties of the spray material. In addition, the state of the art in spraying equipment is reviewed. Special emphasis is put on recent improvements that ensure better coating performance and widen the range of sprayable materials. Finally, an outlook is given regarding further developments and future prospects of this technique, in particular with respect to current and potential applications.