The processing of traditional Chinese medicine (TCM) represents a distinctive pharmaceutical practice in China and serves as a defining feature that sets Chinese medicine apart from natural or plant-based remedies. Documented as early as in the Huangdi Neijing (Inner Canon of the Yellow Emperor), TCM processing has evolved over more than 2,000 years through continuous inheritance, innovation, and development, combining TCM theory with clinical practice and holding a critical role within the field. In recent years, Chinese herbal pieces, as a form of TCM prescription, have demonstrated a notable impact in the prevention and management of COVID-19, highlighting their unique therapeutic value and contributing to China’s clinical treatment strategies while offering international insights and expertise in epidemic control. This paper summarizes recent research progress on the processing of representative TCMs, examines the mechanisms by which processing modifies medicinal properties and reduces toxicity, and discusses the integration and application of various modern technologies and methods, thereby uncovering the contemporary scientific intricacies of TCM processing techniques.