Amorphous solid dispersions (ASDs) can increase the oral bioavailability of poorly soluble drugs. However, their use in drug development is comparably rare due to a lack of basic understanding of mechanisms governing drug liberation and absorption in vivo. Furthermore, the lack of a unified nomenclature hampers the interpretation and classification of research data. In this review, we therefore summarize and conceptualize mechanisms covering the dissolution of ASDs, formation of supersaturated ASD solutions, factors responsible for solution stabilization, drug uptake from ASD solutions, and drug distribution within these complex systems as well as effects of excipients. Furthermore, we discuss the importance of these findings on the development of ASDs. This improved overall understanding of these mechanisms will facilitate a rational ASD formulation development and will serve as a basis for further mechanistic research on drug delivery by ASDs.