Lignin represents the largest aromatic carbon resource in plants, holding significant promise as a renewable feedstock for bioaromatics and other cyclic hydrocarbons in the context of the circular bioeconomy. However, the methoxy groups of aryl methyl ethers, abundantly found in technical lignins and lignin‐derived chemicals, limit their pertinent chemical reactivity and broader applicability. Unlocking the phenolic hydroxyl functionality through O‐demethylation (ODM) has emerged as a valuable approach to mitigate this need and enables further applications. In this review, we provide a comprehensive summary of the progress in the valorization of technical lignin and lignin‐derived chemicals via ODM, both catalytic and non‐catalytic reactions. Furthermore, a detailed analysis of the properties and potential applications of the O‐demethylated products is presented, accompanied by a systematic overview of available ODM reactions. This review primarily focuses on enhancing the phenolic hydroxyl content in lignin‐derived species through ODM, showcasing its potential in the catalytic funneling of lignin and value‐added applications. A comprehensive synopsis and future outlook are included in the concluding section of this review.