Phase Change Materials (PCM) can also be seen as a revolution in increasing thermal energy storage and making the smart building design environmentally friendly. PCMs are able to manage indoor environments, save energy, and provide comfort in occupancies by retaining and releasing latent heat during the solid and liquid phases of temperature change. This review explicitly discusses the categories, thermophysical properties and processes of PCMs including organic, inorganic and eutectic and how they are incorporated into building envelopes, walls as well as glazing systems. Interaction of PCMs with Energy Management Systems (EMS), artificial intelligence (AI) and the Internet of Things (IoT) makes it possible to adjust and optimize the energy flows. Reducing HVAC loads and saving up to 30% of energy with the use of PCMs prove to be valid and result in the case studies showing the potential of PCMs to enhance the net-zero and carbon-neutral objectives. Although these factors are problematic in terms of thermal stability, their material degradation, and economic sustainability, recent advancements in the nano-enhanced composite and AI-driven feedback systems should be more reliable and effective in their performance. The paper concludes that next generation smart, resilient and energy efficient architecture, in the overall context of sustainable urban development is made possible by multi-functional PCMs that are the; enabling factors.