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Background In knowledge translation, complex interventions may be implemented in the attempt to improve uptake of research-based knowledge in practice. Traditional evaluation efforts that focus on aggregate effectiveness represent an oversimplification of both the environment and the interventions themselves. However, theory-based approaches to evaluation, such as realist evaluation (RE), may be better-suited to examination of complex knowledge translation interventions with a view to understanding what works, for whom, and under what conditions. It is the aim of the present state-of-the-art review to examine current literature with regard to the use of RE in the assessment of knowledge translation interventions implemented within healthcare environments. Methods Multiple online databases were searched from 1997 through June 2013. Primary studies examining the application or implementation of knowledge translation interventions within healthcare settings and using RE were selected for inclusion. Varying applications of RE across studies were examined in terms of a) reporting of core elements of RE, and b) potential feasibility of this evaluation method. Results A total of 14 studies (6 study protocols), published between 2007 and 2013, were identified for inclusion. Projects were initiated in a variety of healthcare settings and represented a range of interventions. While a majority of authors mentioned context (C), mechanism (M) and outcome (O), a minority reported the development of C-M-O configurations or testable hypotheses based on these configurations. Four completed studies reported results that included refinement of proposed C-M-O configurations and offered explanations within the RE framework. In the few studies offering insight regarding challenges associated with the use of RE, difficulties were expressed regarding the definition of both mechanisms and contextual factors. Overall, RE was perceived as time-consuming and resource intensive. Conclusions The use of RE in knowledge translation is relatively new; however, theory-building approaches to the examination of complex interventions in this area may be increasing as researchers attempt to identify what works, for whom and under what circumstances. Completion of the RE cycle may be challenging, particularly in the development of C-M-O configurations; however, as researchers approach challenges and explore innovations in its application, rich and detailed accounts may improve feasibility. Electronic supplementary material The online version of this article (doi:10.1186/s13012-014-0115-y) contains supplementary material, which is available to authorized users.