Berberine is a isoquinoline alkaloid extracted from Chinese herbs such as Coptidis rhizome. In the past decade, there are more than 2 000 published papers studying the clinical application, pharmacodynamic mechanism and structure-activity relationship (SAR) of berberine and its derivatives, for treating tumor, diabetes, cardiavascellum disease, hyperlipemia, inflammation, bacterium and virus infection, cerebral ischemia trauma, mental disease, Alzheimer disease, osteoporosis, and so on. These results demonstrate that berberine has wide physiologic function and has great potential for structural modification as new drug lead. However, there is no systematic review about the study of berberine and its derivatives up to now. This paper is a systematic review of the research advances of berberine and its derevatives in clinical application, pharmacodynamic mechanisms, molecular pharmacology, absorption and metabolism, and SAR studies. The current review would provide some useful information for further study on structural modification of berberine for discovering new drug leads based on its pharmacodynamic mechanisms.