Accumulation of dust and ice particles into planetesimals is an important step in the planet formation process. Planetesimals are the seeds of both terrestrial planets and the solid cores of gas and ice giants forming by core accretion. Left-over planetesimals in the form of asteroids, trans-Neptunian objects and comets provide a unique record of the physical conditions in the solar nebula. Debris from planetesimal collisions around other stars signposts that the planetesimal formation process, and hence planet formation, is ubiquitous in the Galaxy. The planetesimal formation stage extends from micrometer-sized dust and ice to bodies which can undergo run-away accretion. The latter ranges in size from 1 km to 1000 km, dependent on the planetesimal eccentricity excited by turbulent gas density fluctuations. Particles face many barriers during this growth, arising mainly from inefficient sticking, fragmentation and radial drift. Two promising growth pathways are mass transfer, where small aggregates transfer up to 50% of their mass in high-speed collisions with much larger targets, and fluffy growth, where aggregate cross sections and sticking probabilities are enhanced by a low internal density. A wide range of particle sizes, from mm to 10 m, concentrate in the turbulent gas flow. Overdense filaments fragment gravitationally into bound particle clumps, with most mass entering planetesimals of contracted radii from 100 to 500 km, depending on local disc properties. We propose a hybrid model for planetesimal formation where particle growth starts unaided by self-gravity but later proceeds inside gravitationally collapsing pebble clumps to form planetesimals with a wide range of sizes.