Phenolic compounds arise from the shikimic and acetic acid (polyketide) metabolic pathways in plants. They are but one category of the many secondary metabolites implicated in plant allelopathy. Phenolic allelochemicals have been observed in both natural and managed ecosystems, where they cause a number of ecological and economic problems, such as declines in crop yield due to soil sickness, regeneration failure of natural forests, and replanting problems in orchards. Phenolic allelochemical structures and modes of action are diverse and may offer potential lead compounds for the development of future herbicides or pesticides. This article reviews allelopathic effects, analysis methods, and allelopathic mechanisms underlying the activity of plant phenolic compounds. Additionally, the currently debated topic in plant allelopathy of whether catechin and 8-hydroxyquinoline play an important role in Centaurea maculata and Centaurea diffusa invasion success is discussed. Overall, the main purpose of this review is to highlight the allelopacthic potential of phenolic compounds to provide us with methods to solve various ecology problems, especially in regard to the sustainable development of agriculture, forestry, nature resources and environment conservation.