As a key structural parameter, phase depicts the arrangement of atoms in materials. Normally, a nanomaterial exists in its thermodynamically stable crystal phase. With the development of nanotechnology, nanomaterials with unconventional crystal phases, which rarely exist in their bulk counterparts, or amorphous phase have been prepared using carefully controlled reaction conditions. Together these methods are beginning to enable phase engineering of nanomaterials (PEN), i.e., the synthesis of nanomaterials with unconventional phases and the transformation between different phases, to obtain desired properties and functions. This Review summarizes the research progress in the field of PEN. First, we present representative strategies for the direct synthesis of unconventional phases and modulation of phase transformation in diverse kinds of nanomaterials. We cover the synthesis of nanomaterials ranging from metal nanostructures such as Au, Ag, Cu, Pd, and Ru, and their alloys; metal oxides, borides, and carbides; to transition metal dichalcogenides (TMDs) and 2D layered materials. We review synthesis and growth methods ranging from wet-chemical reduction and seed-mediated epitaxial growth to chemical vapor deposition (CVD), high pressure phase transformation, and electron and ion-beam irradiation. After that, we summarize the significant influence of phase on the various properties of unconventional-phase nanomaterials. We also discuss the potential applications of the developed unconventional-phase nanomaterials in different areas including catalysis, electrochemical energy storage (batteries and supercapacitors), solar cells, optoelectronics, and sensing. Finally, we discuss existing challenges and future research directions in PEN.