Linalool, as a major volatile compound, is widely distributed in natural plant essential oil. In addition, it can also be artificially synthesized. Linalool is used frequently as an important ingredient of perfumes and household detergents. It is still employed in food flavor and industries. Besides, linalool has some positive effect on healthcare. Many studies have showed that linalool exhibited a variety of pharmacological activities, including analgesic, anxiolytic, sedative, anti-inflammatory, anti-tumor and anti-bacterial effects. Therefore, linalool will be a promising agent for clinical application. This article reviews the pharmacological effects and formulation studies of linalool so as to provide a theoretical basis for its further development and utilization.