Xylan is the most abundant hemicellulose, constitutes about 25–35% of the dry biomass of woody and lignified tissues, and occurs up to 50% in some cereal grains. The accurate degree and position of xylan acetylation is necessary for xylan function and for plant growth and development. The post synthetic acetylation of cell wall xylan, mainly regulated by Reduced Wall Acetylation (RWA), Trichome Birefringence-Like (TBL), and Altered Xyloglucan 9 (AXY9) genes, is essential for effective bonding of xylan with cellulose. Recent studies have proven that not only xylan acetylation but also its deacetylation is vital for various plant functions. Thus, the present review focuses on the latest advances in understanding xylan acetylation and deacetylation and explores their effects on plant growth and development. Baseline knowledge about precise regulation of xylan acetylation and deacetylation is pivotal to developing plant biomass better suited for second-generation liquid biofuel production.