This monograph gives a comprehensive description of the relationship and connections between kinetic theory and fluid dynamics, mainly for a time-independent problem in a general domain. Ambiguities in this relationship are clarified, and the incompleteness of classical fluid dynamics in describing the behavior of a gas in the continuum limit—recently reported as the ghost effect—is also discussed. The approach used in this work engages an audience of theoretical physicists, applied mathematicians, and engineers. By a systematic asymptotic analysis, fluid-dynamic-type equations and their associated boundary conditions that take into account the weak effect of gas rarefaction are derived from the Boltzmann system. Comprehensive information on the Knudsen-layer correction is also obtained. Equations and boundary conditions are carefully classified depending on the physical context of problems. Applications are presented to various physically interesting phenomena, including flows induced by temperature fields, evaporation and condensation problems, examples of the ghost effect, and bifurcation of flows. Kinetic Theory and Fluid Dynamics serves as a bridge for those working in different communities where kinetic theory is important: graduate students, researchers and practitioners in theoretical physics, applied mathematics, and various branches of engineering.