Lycium barbarum polysaccharide (LBP) is one of the major ingredients responsible for those biological activities in Lycium barbarum L.. It has been the hot spot in recent years because of its various important biological activities, such as antioxidant, immunomodulation and antitumor. The purpose of the present review is to summarize previous and current references regarding the preparation, biological activities as well as development of LBP. The preparation of LBP includes extraction, separation, and purification. The extraction methods contain water extraction and alcohol precipitation, alkali extraction, ultrasonic extraction, and microwave-assisted. Separation and purification methods consist of Sevage, TCA, protease, active carbon, polymer-salt aqueous two-phase systems and other methods. The above methods are used to remove free protein, pigments and other impurities from polysaccharides. After that, precipitation, cellulose ion exchange column chromatography, and gel filtration chromatography are used to purify single polysaccharide. Besides, this article introduces the application of LBP in the pharmaceutical, food, livestock feed, and other areas. The future research directions are suggested for the further study and utilization of LBP.