This study presents a novel approach for regulating the properties of lignin‐based silver nanoparticles (AgNPs), which was UV‐induced Tetrahydrofuran (THF) to form peroxide for the etching of these nanoparticles. The lignin coating was first degraded by oxidation, and the properties of the exposed AgNPs changed under etching. Notably, water can greatly regulate the oxidation capacity of the THF medium, thereby controlling the degradation degree of lignin coating and obtaining dissolution, aggregation, precipitation, and color‐variable phenomena of AgNPs under the synergistic effect of UV irradiation and peroxide etching. By adjusting UV irradiation time, various functional products of silver nanowires (AgNWs), color‐variable AgNPs, lignin‐based AgNPs aggregates, and composite solution of Ag particles and Ag+ were obtained. The transformation of these product properties is closely related to the oxidation capacity of H2O/THF medium. In addition, Multi‐functional Lignin‐based AgNPs show excellent application potential in conductive coating, antibacterial enhancement, and product separation, providing a promising avenue for the targeted utilization of lignin‐based AgNPs.