Graphene-based nanomaterials have emerged as a novel type of materials with exceptional physicochemical properties and numerous applications in various areas. In this review, we summarize recent advances in studying interactions between graphene and biosystems. We first provide a brief introduction on graphene and its derivatives, and then discuss on the toxicology and biocompatibility of graphene, including the extracellular interactions between graphene and biomacromolecules, cellular studies of graphene, and in vivo toxicological effects. Next, we focus on various graphene-based practical applications in antibacterial materials, wound addressing, drug delivery, and water purification. We finally present perspectives on challenges and future developments in these exciting fields.