Based on the national carbon neutral background, the effective use of biomass, as an important renewable resource, is crucial. Pyrolysis of biomass for oil production has the potential to achieve large-scale production, which has become the main content of biomass utilization. Biomass pyrolysis technology can be divided into direct liquefaction and indirect liquefaction according to different liquefaction methods.The components of bio-oil obtained from direct biomass liquefaction is unstable, and the quality of the bio-oil obtained from indirect liquefaction depends on the reactor type, reaction temperature, and catalyst type. The quality of bio-oil varies greatly due to different preparation methods, and it′s necessary to modificate and upgrade the bio-oil for its practical application. The types of catalysts used to improve the quality of bio-oil during biomass pyrolysis were summarized and compared. The technical routes for the modification and upgrading of raw bio-oil after separation into light and heavy components were emphatically reviewed, which could transform into gas or fuel oil or even chemicals to realize the high-value application of the bio-oil. The modification methods for light oil components include production hydrogen by steam reforming, catalytic cracking, hydrodeoxygenation, catalytic esterification, and other processes. The type of catalyst is mainly molecular sieve and precious metals. However, the heavy oil component has low water content, high viscosity, and there are few related upgrading studies. At present, hydrogenation, catalytic cracking, catalytic esterification, solvent addition, and gasification are mainly reported. Catalyst, hydrogen source, and energy consumption are the main reasons for limiting their scale and industrial application of bio-oil upgrading and modification methods. Reducing the cost of the catalyst and improving the catalyst life, reducing the use of hydrogen source or using low cost hydrogen source, simplifying the process, and decreasing reaction temperture are the development direction of bio-oil upgrading technology.