Traditional pulse-echo ultrasound imaging heavily relies on the discernment of signals based on their relative magnitudes but is limited in its ability to mitigate sources of image degradation, the most prevalent of which is acoustic clutter. Advances in computing power and data storage have made it possible for echo data to be alternatively analyzed through the lens of spatial coherence, a measure of the similarity of these signals received across an array. Spatial coherence is not currently explicitly calculated on diagnostic ultrasound scanners but a large number of studies indicate that it can be employed to describe image quality, to adaptively select system parameters and to improve imaging and target detection. With the additional insights provided by spatial coherence, it is poised to play a significant role in the future of medical ultrasound. This review details the theory of spatial coherence in pulse-echo ultrasound and key advances made over the last few decades since its introduction in the 1980s.