Aluminum hydride (AlH₃) has high hydrogen content capacity (mass content>10%), low molecular weight of combustion products and relatively high thermal decomposition temperature. AlH₃ can significantly improve the energy level of solid propellants by partially replacing aluminum powder, so it is considered as a very important high-energy fuel. However, there is critical dependence of the solid propellant performances on the quality of AlH₃ crystals. The choice and optimization of preparation method largely determines the quality and cost of the products. It has been shown that the unstable nature of AlH₃ could greatly affect the aging and storage performances. Moreover, the incompatibility between some components and AlH₃ decreases the safety of corresponding solid propellants. The problems mentioned above are the key technical issues and need to be solved before large-scale application of AlH₃ in solid propellant formulations. The advances in synthetic techniques for AlH₃ and its application in solid propellants over the world have been introduced in this review paper. The stabilizing strategies and post evaluation of AlH₃ in relevant research institutes are summarized as well, based on which the future research directions are proposed. The literature shows that the safety and quality control during scaling-up of AlH₃ can be solved by using ether synthetic method. The applicability of AlH₃ in solid propellant can be greatly improved by surface treatment, including coating of AlH₃.