This review article by Dirk Helbing explores the dynamics of traffic and pedestrian systems, focusing on the underlying principles and modeling approaches. It begins with an introduction to the historical context and the importance of understanding traffic dynamics, highlighting the significant impact of traffic congestion on society. The article then delves into the theoretical framework of driven and self-driven many-particle systems, discussing classical mechanics, fluids, granular media, and active Brownian particles. It explains how these systems can be described using microscopic, mesoscopic, and macroscopic models, emphasizing the micro-macro link and universal concepts. The review covers empirical findings in freeway traffic, including measurement techniques, the fundamental diagram, and hysteresis. It discusses the characteristics of different traffic states, such as free flow, synchronized flow, and wide moving jams. The article also examines various modeling approaches for vehicle and pedestrian traffic, including microscopic follow-the-leader models, cellular automata, master equations, and fluid-dynamic models. Key phenomena in traffic and pedestrian systems are explored, such as "phantom traffic jams," stop-and-go waves, and the formation of lanes. The article also addresses the transition to congested traffic at bottlenecks and the effects of heterogeneous traffic. It discusses multi-lane traffic, bi-directional and city traffic, and the optimization of traffic control. The review further examines pedestrian traffic, including behavioral force models, self-organization phenomena, and collective behaviors in panic situations. It touches on the similarities between traffic and biological or socio-economic systems, such as bacterial colonies, flocks of birds, and stock market dynamics. Finally, the article concludes with a summary and outlook, emphasizing the importance of interdisciplinary research and the need for further exploration of open problems in the field.This review article by Dirk Helbing explores the dynamics of traffic and pedestrian systems, focusing on the underlying principles and modeling approaches. It begins with an introduction to the historical context and the importance of understanding traffic dynamics, highlighting the significant impact of traffic congestion on society. The article then delves into the theoretical framework of driven and self-driven many-particle systems, discussing classical mechanics, fluids, granular media, and active Brownian particles. It explains how these systems can be described using microscopic, mesoscopic, and macroscopic models, emphasizing the micro-macro link and universal concepts. The review covers empirical findings in freeway traffic, including measurement techniques, the fundamental diagram, and hysteresis. It discusses the characteristics of different traffic states, such as free flow, synchronized flow, and wide moving jams. The article also examines various modeling approaches for vehicle and pedestrian traffic, including microscopic follow-the-leader models, cellular automata, master equations, and fluid-dynamic models. Key phenomena in traffic and pedestrian systems are explored, such as "phantom traffic jams," stop-and-go waves, and the formation of lanes. The article also addresses the transition to congested traffic at bottlenecks and the effects of heterogeneous traffic. It discusses multi-lane traffic, bi-directional and city traffic, and the optimization of traffic control. The review further examines pedestrian traffic, including behavioral force models, self-organization phenomena, and collective behaviors in panic situations. It touches on the similarities between traffic and biological or socio-economic systems, such as bacterial colonies, flocks of birds, and stock market dynamics. Finally, the article concludes with a summary and outlook, emphasizing the importance of interdisciplinary research and the need for further exploration of open problems in the field.