Abstract: China’s walnut planting area and yield ranks first in the world, but the walnut processing industry mainly uses walnut kernel. High value-added by-products such as green husk, walnut shell, and walnut seed coat are discarded or incinerated, which not only pollute the environment but also cause waste of high-quality biomass resources. The application value of walnut remains to be further explored. Traditional walnut by-products processing technology or equipment is insufficient to meet the requirements of multi-field industry for walnut production and quality, seriously restricting the in-depth development of the walnut industry. Therefore, it is imperative to strengthen the research and development of key technologies and devices for preliminary processing of walnut fruit by-products. For green husk removal, three peeling principles of scraping, cutting, and extruding are analyzed based on the structural and physical characteristics. Based on the principles of peeling, the present situation and application characteristics of the peeling equipment are classified and summarized. The multi-factor performance tests of different types of devices are analyzed, and the optimal parameter combinations are obtained. For the drying of walnut in the key transition process, the corresponding physical characteristics of walnut, such as water content, porosity, thermal conductivity, and water diffusivity, are analyzed. The range of parameters representing different physical characteristics is obtained. The working mechanism and application of hot air, heat pump, solar energy, gas jet, and radiation drying modes are studied. Through multi-factors performance test, the main influencing factors and the optimal parameter combination of each type of device are obtained. Based on the physicochemical properties of walnut kernel/seed coat, this paper emphatically analyzed lye peeling and various physical peeling methods and put forward a new high temperature instantaneous low damage walnut seed coat peeling method based on the baking method. For walnut shell ultra-micro crushing, the fracture interface characteristics of the walnut shell are analyzed, the cracking and crushing mechanism are emphatically classified in detail, and a variety of innovative walnut shell ultra-micro crushing devices and walnut ultra-micro powder grading devices are introduced. This review systematically summarized the physical characteristics, working mechanism, device, and performance optimization test, corresponding to the key links of walnut by-product processing. The finding can be expected to deepen the understanding of walnut by-product processing and further provide theoretical basis and technical support for improving walnut processing level.