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Policosanol is widely distributed naturally and can be isolated and purified from rice bran, sugarcane, apples, grapes etc. Due to its functional significance and ease of bioavailability, techniques for the extraction of policosanol are of great significance to investigators, of which saponification, solvent extraction, transesterification, molecular distillation, supercritical carbon dioxide extraction, ultrasonic-assisted extraction and other extraction methods are evaluated. Policosanol has been usually applied in functional foods because it has multiple health-improving properties, including the lowering of lipids, anti-aging, tissue regeneration, cyto-, liver, cardiovascular and cerebrovascular protection, and protection against diabetes, hypercholesterolemia, Parkinson’s disease, inflammation, ulcers and cancer. Additionally, the signaling pathways AMPK, MAPK and PI3K/Akt involved in its effects are investigated. This review compiled the most interesting references for scientifics engaged in policosanol health-improving effects, including extraction procedures. To sum up, it will help to develop ancillary drugs and functional foods in the future.