Poria cocos (Fu Ling), a traditional medicinal fungus with more than two millennia of documented use, occupies a central role in East Asian medical practice. This review systematically examines its historical development as recorded in classical materia medica, emphasizing the evolution of its medicinal sources and the specific fungal parts employed. The representative chemical constituents—namely triterpenoids and polysaccharides—are thoroughly summarized with regard to their structural types and distinguishing characteristics. Building on classical therapeutic indications such as promoting diuresis, strengthening the spleen, and calming the mind, recent research is reviewed to elucidate the expanded pharmacological profile of Poria cocos. Particular focus is given to its antitumor effects, immunomodulatory activity, anti-obesity properties, mitigation of metabolic dysfunction-associated steatotic liver disease, and enhancement of intestinal barrier function. Current mainstream quality-evaluation methodologies are outlined, followed by an in-depth discussion of the pharmacokinetics of its principal bioactive components, with special emphasis on the microbial fermentation of polysaccharides into short-chain fatty acids by the gut microbiota. The synergistic role of Poria cocos in polyherbal formulations, exemplified by Sijunzi Decoction, is analyzed to highlight its compatibility-enhancing effects. Contemporary applications in modern pharmaceuticals and functional foods are also summarized. Finally, key challenges and prospective directions for future research and industrial development are addressed. This review aims to provide a comprehensive reference for basic research, product innovation, and clinical utilization of Poria cocos. Graphical Abstract: http://links.lww.com/AHM/A199