Bio‐oil from lignocellulosic biomass pyrolysis is a promising feedstock as a precursor for the production of transportation fuels and value‐added chemicals. The presence of significant concentrations of oxygen, water, and acids makes it difficult to use bio‐oil directly as a transportation fuel without costly upgrading. The acidity of pyrolysis liquids is mainly derived from volatile acids, such as acetic acid, causing chemical instability and corrosion. The extraction of acids from bio‐oil can therefore offer strategies for improved applications and economic value. Moreover, acetic acid is a valuable reagent and the building block for several commercially important chemicals. This review presents the results of important research related to the production of bio‐oil‐derived acetic acid. The discussion is intended to summarize the effect of biomass type and pretreatment method, pyrolysis processing conditions, and separation techniques on acetic acid production via pyrolysis. On this basis, acetic acid characterization techniques are also presented along with an overview of acetic acid applications and economic considerations. © 2021 Society of Chemical Industry and John Wiley & Sons, Ltd