Biomaterials such as chitin, chitosan and their derivatives have a significant and rapid development in recent years. Chitin and chitosan have become cynosure of all party because of an unusual combination of biological activities plus mechanical and physical properties. However, the applications of chitin and chitosan are limited due to its insolubility in most of the solvents. The chemical modification of chitin and chitosan are keen interest because of these modifications would not change the fundamental skeleton of chitin and chitosan but would keep the original physicochemical and biochemical properties. They would also bring new or improved properties. The chemical modification of chitin and chitosan by phosphorylation is expected to be biocompatible and is able to promote tissue regeneration. In view of rapidly growing interest in chitin and chitosan and their chemical modified derivatives, we are here focusing the recent developments on preparation of phosphorylated chitin and chitosan in different methods.