Firstly, this paper reviews two main methods for biochar synthesis, namely conventional pyrolysis and hydrothermal carbonization (HTC). The related processes are described, and the influences of biomass nature and reaction conditions, especially temperature, are discussed. Compared to pyrolysis, HTC has advantages for processing high-moisture biomass and producing spherical biochar particles. Secondly, typical features of biochar in comparison with other carbonaceous materials are summarized. They refer to the presence of inorganics, surface functional groups, and local crystalline structures made up of highly conjugated aromatic sheets. Thirdly, various strategies for biochar modification are illustrated. They include activation, surface functionalization, in situ heteroatom doping, and the formation of composites with other materials. An appropriate modification is necessary for biochar used as a catalyst. Fourthly, the applications of biochar-based catalysts in three important processes of biofuel production are reviewed. Sulfonated biochar shows good catalytic performance for biomass hydrolysis and biodiesel production. Biodiesel production can also be catalyzed by biochar-derived or -supported solid-alkali catalysts. Biochar alone and biochar-supported metals are potential catalysts for tar reduction during or after biomass gasification. Lastly, the merits of biochar-based catalysts are summarized. Biochar-based catalysts have great developmental prospects. Future work needs to focus on the study of mechanism and process design.