Stakeholder interaction is increasingly recognised as an essential component of sustainable business models (SBMs), playing an important role for sustainable value propositions, creation and capture. However, research on the role and potential contribution of stakeholder interaction has been fragmented and not comprehensively examined. In response, a systematic literature review was conducted to provide an understanding on the topic. Forty-seven articles were systematically selected and thematically analysed according to SBM elements. Key findings demonstrate that (i) organisations need to consider five preconditions that can influence the role of stakeholder interaction in SBMs; (ii) stakeholder interaction plays different roles depending on if an organisation develops an SBM or innovates an existing BM towards sustainability; (iii) stakeholder interaction plays a multifaceted and reciprocal role in regard to sustainable value propositions, creation and capture; (iv) while the importance of interacting with a broad range of stakeholders is recognised, it is still often treated as add-on with a focus on customers and suppliers. Research gaps and managerial implications are highlighted that can support both academia and practitioners in updating the current knowledge on the role of stakeholder interaction in SBMs.