Onion cultivation in South Korea faces a range of interconnected challenges, shaped by fluctuating supply and demand dynamics, the dominance of imported seed varieties, and the growing issue of fungal pathogens affecting stored onions. In recent years, significant shifts occurred within the onion industry, such as export volumes in 2023 declining to 106 tons compared to 99,506 tons in 2022, while import volumes surged to 113,902 tons to meet domestic demand through the Tariff Rate Quota (TRQ) system. Concurrently, domestic production onion supply in 2023 estimates a total of 1.347 million tons, a 5.2% increase compared to the previous year, due to a 6.3% rise in domestic production. Despite this growth, South Korea's onion seed market remains heavily dependent on imports, particularly from Japan, underscoring the need for the development of competitive domestic cultivars. Furthermore, environmental conditions such as microclimates in regions like Muan have proven to be critical, as they produce onions with superior nutritional profiles and storability. However, fungal diseases pose persistent threats to storage, resulting in substantial economic losses. However, the country's reliance on imported varieties and the climate's effects on cultivation call for more investment in domestic breeding programs and adaptive farming practices. To address these challenges, this review synthesizes historical data, current trends, and the future prospects of onion production, supply, and demand in South Korea. Comprehensive strategies are proposed, including the promotion of adaptive farming practices, investment in domestic breeding programs, and enhanced storage techniques to mitigate fungal pathogens. This work emphasizes the importance of integrated efforts among policymakers, researchers, and industry stakeholders to improve productivity, reduce reliance on imports, and secure a sustainable future for the South Korean onion industry. The findings offer actionable insights for enhancing market competitiveness and achieving agricultural sustainability.