Two-dimensional transition metal chalcogenides exhibit strong light-matter interactions and pronounced excitonic effects, the study of their excited-state dynamics is essential for advancing both fundamental research and technological applications. This review summarizes recent advances in the investigation of excited-state dynamics in monolayer transition metal chalcogenides and their van der Waals heterostructures. Specifically, we discuss the generation and recombination dynamics of excitons in monolayers, as well as interlayer excitons in heterostructures. Particular emphasis is placed on interlayer charge transfer and the influence of stacking angles and moiré superlattices on excited-state dynamics. Finally, we highlight open questions in the field and provide an outlook on future research directions.