The unique medicinal properties of Ganoderma lucidum have led to a growing demand for it as an essential source of dietary supplements in the food sector. The wide array of therapeutic and pharmacological effects of G. lucidum can be attributed principally to its diverse prebiotic and biologically active compounds. This review comprehensively analyzes the practical application of bioactive compounds with its structural characterisation derived from G. lucidum. It also provides an update on the characterization of several compounds from G.lucidum, such as polysaccharides, triterpenoids, nucleotides, meroterpenoids, sesquiterpenoids, and alkaloids. The polysaccharides and peptides derived from G. lucidum, have been extensively utilized in traditional Chinese medicine as immunomodulatory, anticancer, and neuropharmacological agents. Thus, G. lucidum has become an essential part of many's diet because of its antioxidant characteristics and health-promoting properties. Aromatic meroterpenoids, which possess antioxidant properties, have been found to exhibit bioactivities significantly, including antioxidant, anti-HIV protease, and anti-fibrotic capabilities. These compounds, with their unique structures, have garnered interest from phytochemists, chemists, and pharmacologists. A pH-responsive nanoparticle drug delivery system has been developed using G. lucidum polysaccharides, which are well-known for their remarkable anti-tumor properties. Furthermore, G. lucidum has been employed as a medicinal remedy for over two millennia, and have also examined its pharmacological applications.