Ternary solar cells enjoy both an increased light absorption width, and an easy fabrication process associated with their simple structures. Significant progress has been made for such solar cells with demonstrated efficiencies over 7%; however, their fundamental working principles are still under investigation. This Perspective is intended to offer our insights on the three major governing mechanisms in these intriguing ternary solar cells: charge transfer, energy transfer, and parallel-linkage. Through careful analysis of exemplary cases, we summarize the advantages and limitations of these three major mechanisms and suggest future research directions. For example, incorporating additional singlet fission or upconversion materials into the energy transfer dominant ternary solar cells has the potential to break the theoretical efficiency limit in single junction organic solar cells. Clearly, a feedback loop between fundamental understanding and materials selection is in urgent need to accelerate the efficiency improvement of these ternary solar cells.