As a result of continuous curriculum transformation in today's knowledge-based society, government and employers have expressed raising demand for graduates' quality, not only in terms of discipline knowledge but also generic skills. This global movement of generic skills involves many unresolved issues that need to be thoroughly investigated. Thus, in this paper, we provide a critical review of literature on challenges in generic-skills development as identified over the past 20 years. Firstly, there is disagreement on the definition of generic skills. A variety of terms have been used interchangeably to express the notion of generic skills, yet there has not been an open discussion of how such notion can be more appropriately communicated in literature and whether standardized terms can be adopted in future debate. It has been acknowledged in recent literature that generic-skills outcomes are perceived differently among university academics. Also, students may not have a clear understanding of the concept of generic skills, and that makes it difficult for both teachers and students to come to a common understanding about the extent to which generic skills should be taught in university. Secondly, traditional academic practice does not correspond to employers' expectations of graduates. Although employers expect graduates to be proficient in generic skills, it is challenging to integrate generic skills into university curriculum because generic skills are context-dependent and their use vary among different disciplines. Some teachers do not welcome generic-skills teaching; they are not open to the many new perspectives and ideas about generic skills such as lifelong learning and transferability of students' prior knowledge. Students' unfavourable responses to learning generic skills also contribute to teachers' reluctance to teach generic skills. Thirdly, in terms of pedagogy, even if some teachers are positive about generic-skills teaching, teaching and assessing generic skills are indeed challenging. Often, lack of support from colleagues and management for the development and assessment of generic skills makes implementation so difficult that it is attainable through remedial channels only. Fourthly, a range of institutional factors add to the complication in generic-skills agenda. Increased student numbers have led to the modularization of degree programmes and the decrease in small group teaching and formative assessment tasks, which are fundamental to student development of generic skills. By reviewing all of these challenges, we hope to gain insights into the implementation of generic skills in curriculum and how future research should be oriented.