Bionanocomposites are emerging nanostructure hybrid materials composed of natural polymers and inorganic solids. Bionanocomposites became a subject of intensive research owing to their inherent properties such as nontoxicity, biocompatibility, biodegradability as well as their improved structural and functional properties. Among these bionanocomposites, chitosan-based nanocomposites have attracted a great deal of attention especially in biomedical field. Globally, chitosan is the second most bountiful natural polymer following cellulose. Chitosan is a biocompatible and biodegradable polymer possessing unique structural, chemical, and biological properties. The last decade has witnessed enormous multidisciplinary research focused on improving the properties of chitosan and its derivatives. As a result, several chitosan-based nanocomposites with enhanced physical and chemical properties have been developed in eco-friendly and cost-effective manner. This chapter provides an overview on different aspects of chitosan including its properties and modifications, and focuses on chitosan-based nanocomposites. Important biomedical applications of chitosan-based nanocomposites are also discussed in this chapter including tissue engineering, wound healing, tissue regeneration, drug delivery, and biosensors.