Graphene and its derivatives show great potential for biosensing due to their extraordinary optical, electrical and physical properties. In particular, graphene and its derivatives have excellent optical properties such as broadband and tunable absorption, fluorescence bursts, and strong polarization-related effects. Optical biosensors based on graphene and its derivatives make nondestructive detection of biomolecules possible. The focus of this paper is to review the preparation of graphene and its derivatives, as well as recent advances in optical biosensors based on graphene and its derivatives. The working principle of face plasmon resonance (SPR), surface-enhanced Raman spectroscopy (SERS), fluorescence resonance energy transfer (FRET) and colorimetric sensors are summarized, and the advantages and disadvantages of graphene and its derivatives applicable to various types of sensors are analyzed, and the methods of surface functionalization of graphene and its derivatives are introduced; these optical biosensors can be used for the detection of a range of biomolecules such as single cells, cellular secretions, proteins, nucleic acids, and antigen-antibodies; these new high-performance optical sensors are capable of detecting changes in surface structure and biomolecular interactions with the advantages of ultra-fast detection, high sensitivity, label-free, specific recognition, and the ability to respond in real-time. Problems in the current stage of application are discussed, as well as future prospects for graphene and its biosensors. Achieving the applicability, reusability and low cost of novel optical biosensors for a variety of complex environments and achieving scale-up production, which still faces serious challenges. [ABSTRACT FROM AUTHOR]