The ethanol oxidation reaction (EOR) has drawn increasing interest in electrocatalysis and fuel cells by considering that ethanol as a biomass fuel has advantages of low toxicity, renewability, and a high theoretical energy density compared to methanol. Since EOR is a complex multiple-electron process involving various intermediates and products, the mechanistic investigation as well as the rational design of electrocatalysts are challenging yet essential for the desired complete oxidation to CO2. This mini review is aimed at presenting an overview of the advances in the study of reaction mechanisms and electrocatalytic materials for EOR over the past two decades with a focus on Pt- and Pd-based catalysts. We start with discussion on the mechanistic understanding of EOR on Pt and Pd surfaces using selected publications as examples. Consensuses from the mechanistic studies are that sufficient active surface sites to facilitate the cleavage of the C–C bond and the adsorption of water or its residue are critical for obtaining a higher electro-oxidation activity. We then show how this understanding has been applied to achieve improved performance on various Pt- and Pd-based catalysts through optimizing electronic and bifunctional effects, as well as by tuning their surface composition and structure. Finally we point out the remaining key problems in the development of anode electrocatalysts for EOR.