Carbon dioxide ($CO_2$) is one of the natural refrigerants which can be used as working fluid in various refrigeration applications along with the ammonia and hydrocarbons due to its eco-friendliness, higher volumetric capacity, good heat transfer properties, etc. The present article consists of two parts: A detailed comparative study of $CO_2$-based transcritical refrigeration systems with conventional refrigerants-based systems in terms of both thermodynamic and heat transfer performances, and review of both theoretical and experimental researches on transcritical $CO_2$ vapor compression cycle for various refrigeration applications including commercial product status. Suitability of the $CO_2$ system in specific refrigeration application is also discussed.