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Neural interfacing devices using penetrating microelectrode arrays have emerged as an important tool in both neuroscience research and medical applications. These implantable microelectrode arrays enable communication between man-made devices and the nervous system by detecting and/or evoking neuronal activities. Recent years have seen rapid development of electrodes fabricated using flexible, ultrathin carbon-based microfibers. Compared to electrodes fabricated using rigid materials and larger cross-sections, these microfiber electrodes have been shown to reduce foreign body responses after implantation, with improved signal-to-noise ratio for neural recording and enhanced resolution for neural stimulation. Here, we review recent progress of carbon-based microfiber electrodes in terms of material composition and fabrication technology. The remaining challenges and future directions for development of these arrays will also be discussed. Overall, these microfiber electrodes are expected to improve the longevity and reliability of neural interfacing devices.