Buffalo population has dramatically increased during the last two decades, especially in tropical and subtropical regions. Although buffalo are important milk and meat-producing animal, still practices of buffalo farming and welfare aspects are not well established. Housing system and stocking density are significant factors that affect the welfare and production of animals; however, no space allowance standards have been demonstrated for buffalo at different ages. This review article presents the following: (1) an overview of buffalo subtypes and their geographical distribution of buffalo populations and their production; (2) the effect of housing systems and space allowance on the social behavior and welfare indices; (3) the effects of space allowance on milk production and growth performance of buffalo; and (4) the relationship between space allowance and reproductive performance. Although the limited data in this area of research, it can be driven that a larger space allowance with access to a pool, especially during the hot season, maintains buffalo production at optimal levels. Moreover, optimal floor space improves the welfare and social indices of buffalo; however, there are discrepancies in aggressive and agonistic behavior results. Surprisingly, the reproductive performance of buffalo was not affected by space allowance. Therefore, further research is needed to identify the impact of the housing aspects, including space allowance and enrichment tools. on the productive performance, and welfare indices of buffalo. This would assist in implementing welfare-economic standards for buffalo production and reveal the potentiality of this eco-friendly animal.