The ionic liquids have emerged as new solvents and catalysts for processing biomass to value added chemicals and fuels. This review will present the recent developments in applications of ionic liquids in lignocellulosic biomass pretreatments, depolymerization, biodiesel synthesis, dehydration of carbohydrates to renewable feedstock chemicals as well as further transformations of biomass derived feedstocks such as furfural, 5-hydroxymethylfurfural and levulinic acid to value added chemicals. In addition, the recycling of ionic liquids used in biomass processing is also discussed in the review.