In-stent restenosis (ISR) remains a major challenge limiting long-term patency and limb outcomes after endovascular treatment for lower extremity arteriosclerosis obliterans. Unlike coronary arteries, lower extremity arteries, particularly the superficial femoral artery, are continuously exposed to complex biomechanical stresses including bending, stretching, compression, and torsion. Consequently, the development of ISR is driven by the interaction of multiple mechanisms, including vascular injury, inflammatory and immune responses, vascular smooth muscle cell phenotypic switching, metabolic reprogramming, endothelial repair dysfunction, and in-stent neoatherosclerosis. This review summarizes recent advances in the pathophysiological mechanisms of lower extremity arterial ISR and discusses the clinical value and limitations of molecular biomarkers, including inflammatory markers, platelet function indicators, and non-coding RNAs, in risk stratification and prognostic assessment. Furthermore, diagnostic approaches and endovascular reintervention strategies for different ISR phenotypes are reviewed based on the Tosaka classification and intravascular imaging modalities such as intravascular ultrasound and optical coherence tomography. Future research should focus on biomechanical-biological interactions, cellular heterogeneity, multi-omics technologies, and artificial intelligence-assisted imaging to establish mechanism-based risk prediction and precision management strategies for improving individualized treatment and long-term outcomes in patients with lower extremity arterial ISR.