Abstract: Municipal solid waste incineration (MSWI) fly ash is classified as hazardous waste due to its co-enrichment with heavy metals and persistent organic pollutants such as dioxins, making its safe disposal a critical challenge in solid waste management. This paper provides a systematic review of recent advances in the physicochemical characteristics of MSWI fly ash and immobilization of heavy metals during melting treatment. First, it clarifies the differences between grate furnace MSWI fly ash and fluidized bed MSWI fly ash in terms of chemical composition and heavy metals speciation, demonstrating that the widespread exceedance of regulatory thresholds for heavy metals leaching is the fundamental reason for their hazardous designation. The review then highlights melting treatment as a highly effective disposal strategy, owing to its ability to simultaneously achieve significant volume reduction, complete decomposition of dioxins, and efficient immobilization of heavy metals. Key factors influencing heavy metals immobilization are thoroughly examined, including process parameters such as temperature, residence time, and cooling method, as well as the synergistic effects between intrinsic components of MSWI fly ash (e.g., SiO2, Al2O3, CaO, Cl) and exogenous additives. At microscopic levels, heavy metals are effectively immobilized through a combination of mechanisms: reaction-driven formation of stable crystals, isomorphic substitution of atoms within crystals or glass phase, and physical encapsulation by glassy matrix. To address current bottlenecks including high energy consumption and secondary pollution caused by heavy metals volatilization, the review proposes an integrated approach: (1) co-processing with industrial solid wastes to optimize melt composition and reduce energy demand, (2) recycling secondary fly ash for heavy metals enrichment and resource recovery to mitigate secondary pollution, and (3) intensifying research into the physical encapsulation mechanism of the glass phase to enhance heavy metals immobilization efficiency. This strategy aims to advance the safe disposal of MSWI fly ash toward convergence of scientific rigor, economic feasibility, and environmental sustainability.