Performance appraisal and performance management have evolved significantly over the past century, reflecting changes in organizational priorities, workforce dynamics, and technological advancements. This paper critically examines the historical development of these practices, exploring their theoretical foundations, practical applications, and ongoing challenges. Key milestones in the evolution of performance management are identified, highlighting shifts from compliance-driven appraisals to holistic approaches that emphasize employee development and organizational alignment. Despite advancements, persistent issues such as bias, inconsistency, and limited employee engagement remain barriers to effectiveness. The study provides insights into future trends, including the role of artificial intelligence, continuous feedback systems, and the integration of employee well-being into performance metrics. This review underscores the need for innovative and equitable practices to enhance performance management in the modern workplace.