Laser interference displacement measurement technology has become a fundamental one for the current and next-generation high-end equipment and ultra-precision metrology due to its large range, high resolution, noncontact, and traceability. Based on a brief introduction of various existing sub-nanometer laser interferometers, in this study, we review the research results of sub-nanometer- and picometer-level laser interference displacement measurement technology from the aspects of precision, accuracy, and speed. First, starting from the principle of laser interferometer, the main errors and technical difficulties that limit the improvement of resolution and speed of displacement measurements are analyzed. Second, the major technological breakthroughs made in recent years in laser high-precision frequency stabilization, high-precision interferometric mirrors, high-speed/high-resolution phase subdivision technology, and environmental compensation and control are highlighted. Finally, the development trends of the next-generation ultra-precision laser interference displacement measurement technology is summarized and prospected.