The significance of emotion detection lies in the fact that it will enable systems to identify and react to the emotional state of users, which will be highly influential in improving the user experience and, most of all, initiating more meaningful interactions between Humans and Computers. This paper comprehensively reviews the relevant and notable research in the area of computational linguistics, especially chatbot technology, natural language processing, and emotion detection. This paper also explores how artificial intelligence (AI) based systems evolve, criticizes the traditional approaches, and presents novelties in such systems, especially the incorporation and enhancement of emotion detection. The literature review of this paper puts together known knowledge regarding emotion detection techniques and their integration into systems, mainly discussing challenges and innovations within the field in order to improve user interactions and experience.