Transparent wood-based materials (TWMs), made by either bottom-up or top-down strategies, have attracted great attention owing to their transparency, sustainability and multifunctionality. Compared with materials prepared by a traditional bottom-up method, TWMs fabricated via a top-down approach are promising as the natural hierarchical structure of wood is preserved with a high production efficiency, energy savings and scalability. Wood nanotechnologies, various chemical treatments and polymer impregnation or densification techniques have been developed to fabricate TWMs, including transparent wood and transparent wood films, sharing similar sustainability and optical transmittance while also preserving some uniqueness in applications and compositions. Herein, we systematically provide an up-to-date summary on the state-of-the-art for transparent wood and transparent wood films, with a special highlight on the process–structure–property–application perspective, establishing the combination of wood science, material chemistry and physics with new horizons in TWM science. The integrated topics of TWMs emphasize the relationship between nanostructure and properties. The structural and functional design concepts are described for engineering production purposes. The emerging applications of TWMs are also discussed for the potential replacement of glass and petroleum-based plastics. Finally, an outlook and challenges are proposed for the future potential of functional TWMs in engineered production.