The golden needle mushroom (Flammulina velutiper) is one of the most productive mushrooms in the world. However, F. velutiper experiences continuous quality degradation in terms of changes in color and textural characteristics, loss of moisture, nutrition and flavor, and increased microbial populations due to its high respiratory activity during the postharvest phase. Postharvest preservation techniques, including physical, chemical and biological methods, play a vital role in maintaining postharvest quality and extending the shelf life of mushrooms. Therefore, in this study, the decay process of F. velutiper and the factors affecting its quality were comprehensively reviewed. Additionally, the preservation methods (e.g., low‐temperature storage, packaging, plasma treatment, antimicrobial cleaning and 1‐methylcyclopropene treatment) for F. velutiper used for the last 5 years were compared to provide an outlook on future research directions. Overall, this review aims to provide a reference for developing novel, green and safe preservation techniques for F. velutiper. © 2023 Society of Chemical Industry.