Trauma-induced coagulopathy is a maladaptive, multifactorial response to severe injury that affects approximately one quarter of severely injured patients and substantially increases mortality. It arises from combined tissue injury and shock and is characterized by endothelial dysfunction, platelet abnormalities, fibrinogen depletion, and dysregulated fibrinolysis, with thrombin generation typically preserved early and reduced only later, evolving through early hypocoagulable, balanced, and later hypercoagulable phases. Recognition of trauma endotheliopathy, including glycocalyx shedding and the von Willebrand factor-ADAMTS-13 axis, has broadened understanding beyond simple consumption and dilution. Viscoelastic hemostatic assays, thromboelastography and rotational thromboelastometry, characterize clot initiation, propagation, strength, and lysis in near-real time and can detect fibrinolysis, fibrinogen deficiency, and platelet dysfunction that conventional tests miss; early clot amplitude parameters enable rapid, goal-directed decisions, although the largest randomized trial to date did not demonstrate a mortality benefit over conventional testing, and most thresholds remain expert-derived and platform-specific. Contemporary therapy focuses on damage-control resuscitation with permissive hypotension, balanced ratio-based transfusion, early tranexamic acid, calcium replacement, and targeted rather than empiric fibrinogen replacement, with recombinant activated factor VII reserved for rescue. Preinjury antithrombotic therapy and liver disease call for agent-specific adjustments, summarized in an accompanying reference table. This review synthesizes the mechanisms, viscoelastic diagnosis, and goal-directed treatment of trauma-induced coagulopathy and highlights persistent knowledge gaps, including the significance of fibrinolysis shutdown, endotheliopathy-directed therapy, and the optimal timing of venous thromboembolism prophylaxis and resumption of antithrombotic therapy.