Based on a few studies concerning permafrost distribution and mechanisms of the freezing-thawing cycle of active layers influencing groundwater system in terms of groundwater flow and its interaction with surface water in permafrost region, this paper reviews the knowledge of groundwater flow and its interaction with surface water by analyzing studies of the contribution of groundwater flow to channel runoff, groundwater flow paths, and coupled flow and heat transport models. The results indicate that the contribution of groundwater flow to channel runoff varies greatly in different permafrost regions due to the spatial heterogeneity of permafrost. Although identification of groundwater flow paths based on chemical and isotopic tracers will help establish conceptual model of groundwater flow system in permafrost region, however, the analysis results are qualitative or semi-quantitative. Moreover, coupled flow and heat transport models of multi-phase groundwater, which link the vibration of permafrost and the hydrological response process, have already made it possible to quantify groundwater flow processes and groundwater’s interaction with surface water. Future research should devote more attention to improving the practicability of the models in actual catchments.