This study reviews the empirical literature of self-efficacy, a central component of social cognitive theory, in the area of second language learning by focusing on two research questions: first, to what extent, has self-efficacy, as a predicting variable, has been explored in the field of second language learning? Second, what factors affect learners’ self-efficacy beliefs in learning a foreign/second language? On addressing the research questions, 32 articles published between 2003 and 2012 were selected. The articles were classified into two main categories – effects of self-efficacy and factors affecting self-efficacy. Then each category was divided into certain subcategories for discussion. The findings of the review revealed that several factors enhance the level of students’ self-efficacy, and self-efficacy is a strong predictor of performance in different language skills and tasks. Limitations of the empirical studies discussed and directions for further investigation are also presented.