Balsa wood (Ochroma pyramidale), as a kind of natural biomass raw material, is low cost, naturally abundant, renewable and biodegradable, and it also has lots of advantages, including low density, light quality, high porosity and thin cell walls. In addition, it also has a porous hierarchical physical structure, good dimensional stability and easy processing. In recent years, researchers have found that a sponge-like material with large specific surface area, high porosity, excellent mechanical properties and adjustable multistage pore structure could be obtained using these advantages, through a simple and effective top-down processing method, such as cell swelling and drying. This structure is very similar to the traditional aerogel and sponges, so it is called aerogel-type balsa wood, also known as wood sponge (WS). Moreover, through a series of subsequent functionalization, it could be endowed with a variety of new functions, and then be used to prepare biodegradable aerogel-type composite materials. At the same time, this material could overcome some defects of traditional aerogels, such as poor mechanical properties, complicated production process, high energy consumption and non-environmental regeneration, making them ideally suited for the research of various functional materials. In this review, we highlight the micro/nanostructures of balsa wood and aerogel-type balsa, briefly introduce the characteristics of bio-based aerogel-type balsa wood-based composite materials, and summarize the preparation methods. The latest advances in oil/water separation, transparent materials, energy storage materials and other fields are also described. Furthermore, the scientific and technical challenges and future research opportunities are finally discussed, providing a theoretical reference for the high value-added utilization of aerogel-type balsa wood. © 2022 Cailiao Daobaoshe/ Materials Review. All rights reserved.