Acoustofluidics is an emerging interdisciplinary research field that involves the integration of acoustics and microfluidics to address challenges in various scientific areas. This technology has proven to be a powerful tool for separating biological targets from complex fluids due to its label-free, biocompatible, and contact-free nature. Considering a careful designing process and tuning the acoustic field particles can be separated with high yield. Recently the advancement of acoustofluidics led to the development of point-of-care devices for separations of micro particles which address many of the limitations of conventional separation tools. This review article discusses the working principles and different approaches of acoustofluidic separation and provides a synopsis of its traditional and emerging applications, including the theory and mechanism of acoustofluidic separation, blood component separation, cell washing, fluorescence-activated cell sorting, circulating tumor cell isolation, and exosome isolation. The technology offers great potential for solving clinical problems and advancing scientific research.