Modular construction is becoming famous for buildings because it allows a high degree of prefabrication, with individual modules easily transported and installed. Building envelope optimization is vital as it protects buildings from undesirable external environments by expressly preventing the incursion of outside elements. This research uses a systematic literature review to appraise the characteristics of modular envelope panels, focusing on hygrothermal and energy performance. A total of 265 articles were subjected to rigorous filtering and screening measures. The findings reveal notable inconsistencies in modular envelope terminologies and a lack of consistent performance measures, which present significant challenges for research and development efforts. Furthermore, the results indicate a predominant focus on hygrothermal and energy performance in existing studies, with limited attention to environmental impacts and other performance factors. Moreover, the existing literature primarily addresses modular envelope solutions in temperate climates, offering inadequate information for hot and hot–humid climate contexts. To address these gaps, this study proposes categorizing modular envelope panels into four distinct categories: active, passive, smart, and green/vegetated wall panels. These findings will benefit researchers, architects, building envelope designers, policymakers, and organizations developing building performance-related assessment ratings, standards, and codes. The study suggests adopting the categorization of modular envelope panels provided in this study and developing modular panels suitable for hot and humid climates to fill the existing knowledge gap.
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