Bamboo is widely distributed in Southeast Asia, Africa, and Latin America. As a major non-wood forest product and wood substitute, bamboo is of increasing interest to ecologists owing to its rapid growth and correspondingly high potential for mitigating climate change. With a long history of production and utilization of bamboo, China is one of the countries with the richest bamboo resources and largest area of bamboo forest, and has paid unprecedented attention in recent decades to management of its bamboo forests. This review summarizes the versatility of bamboo in terms of its ecological benefits including carbon sequestration, water and soil conservation, its benefits for socioeconomic development, and its potential to mitigate climate change. Current problems, and the future potential of and challenges to rapidly expanding bamboo forests under both wider use of intensive management and the effects of global warming, are also discussed.