Phenolic acids are abundant biomass feedstock that can be derived from the processing of lignin or other byproducts from agro-industrial waste. Although phenolic acids such as p-hydroxybenzoic acid, p-coumaric acid, caffeic acid, vanillic acid, cinnamic acid, gallic acid, syringic acid, and ferulic acid can be used directly in various applications, their value can be significantly increased when they are further modified to high value-added compounds. This review summarizes and discusses the new advances in cell-free and whole-cell biocatalysis technologies for reactions important for conversion of phenolic acids including esterification, decarboxylation, amination, halogenation, hydroxylation, and ring-breakage reactions. The products of these reactions are useful for the pharmaceutical, cosmetic, food, fragrance, and polymer industries. Production of phenolic acids is sustainable, and these processes for their biotransformation are clean technologies that do not produce toxic waste and use less energy than conventional physical and chemical methods. Thus, biotransformation of phenolic acids provides an economically viable and sustainable means for producing useful materials for society.