Peat is a soil that is made up of the partially decomposed remains of dead plants which have accumulated on top of each other in waterlogged places for thousands of years. Peat is brownish-black in color and in its natural state is composed of 90% water and 10% solid material. Peat soils are those in which partially or wholly decomposed organic matter occupies more than half of the uppermost 80 cm of the profile. It constitutes 1, 71, 97 square km (0.1%) of the world land surface and 224,700 ha (1.6 %) of Bangladesh. The main objectives of the review work are to provide information about the peat soils (especially in Khulna regions), their location and extent, properties and process of formation and classification and characteristics. This study also provides information about the limitations of peat soils, and the management practices. Peat soil occupies a large proportion of land surface which could be potential for crop production and so other uses. It is regarded as one of the most important problematic soils in Bangladesh. The improvement of the soil is not impossible but it is difficult and requires long-term development plans.