Liquid crystals (LCs), as a promising branch of highly-sensitive, quick-response, and low-cost materials, are widely applied to the detection of weak external stimuli and have attracted significant attention. Over the past decade, many research groups have been devoted to developing LC-based biosensors due to their self-assembly potential and functional diversity. In this paper, recent investigations on the design and application of LC-based biosensors are reviewed, based on the phenomenon that the orientation of LCs can be directly influenced by the interactions between biomolecules and LC molecules. The sensing principle of LC-based biosensors, as well as their signal detection by probing interfacial interactions, is described to convert, amplify, and quantify the information from targets into optical and electrical parameters. Furthermore, commonly-used LC biosensing targets are introduced, including glucose, proteins, enzymes, nucleic acids, cells, microorganisms, ions, and other micromolecules that are critical to human health. Due to their self-assembly potential, chemical diversity, and high sensitivity, it has been reported that tunable stimuli-responsive LC biosensors show bright perspectives and high superiorities in biological applications. Finally, challenges and future prospects are discussed for the fabrication and application of LC biosensors to both enhance their performance and to realize their promise in the biosensing industry.