Team-based work is considered key to improving the quality of national health systems, yet adverse events in relation to teamwork account for up to a third of all incidents. Teams in healthcare are typically multi-professional and diverse in many dimensions, with cultural diversity being one of the biggest challenges. The objective of this systematic integrative literature review is to analyse the literature to better understand the impact of cultural diversity in healthcare teams on team processes and team and patient outcomes. The study also explores the conditions that enable or hinder team functioning. The results of the review based on 43 articles suggest that cultural diversity threatens to have a negative effect on team processes, team performance, team climate, and patient safety, both directly and indirectly. Culturally sensitive leadership, cultural training, open and transparent procedures appear to mitigate issues associated with cultural differences in healthcare teams. Based on these findings and utilizing SWOT, we identify strengths and weaknesses as well as future research opportunities and threats to the field’s future development.