Vermiculite (VMT) has a unique characteristic of volume expansion after heating, forming highly porous material called expanded VMT, which can be further exfoliated into two-dimensional nanosheets. In this review, we summarized the preparation methods of expanded and exfoliated VMT, as well as the preparation mechanism. The methods to prepare the expanded VMT and exfoliated VMT are partly similar, which include thermal treatment, chemical treatment, and mechanical treatment. Among them, thermal treatment is generally used for expanding VMT. The intercalation treatment is used both for expanding and exfoliating VMT, and mechanical treatment is only used for exfoliating VMT. Meanwhile, we also reviewed the major applications of expanded and exfoliated VMT respectively. The applications of the expanded VMT mainly include environment adsorption, energy storage, flame retardant. Compared with the expanded VMT, the VMT nanosheets with larger specific surface area and more reactive sites provides the opportunities for the exfoliated VMT to serve as nanocomposite materials for nanofluidic channels and intelligent responses besides the above-mentioned applications. However, it is noting that the application of VMT nanosheets is still in its infancy and the exfoliated VMT nanomaterials still have a lot of potentials. The major goal of this review is to reveal the recent progress of expanded and exfoliated VMT in various practical and potential applications and help the researchers to develop more multifunctional materials from VMT.