Lignin has found its diverse applications and one of the potential utility studied was for making polyurethane foam. Polyurethane is a versatile polymer that belongs to the class of “synthetic polymers known as polyurethanes”. It is formed through the reaction of “polyols and diisocyanates”. The reaction between these two components forms “urethane linkages”, which are responsible for the polymer structure. The addition of lignin to polyurethane foams improves the mechanical and protective properties, making them suitable for use in construction, automotive and other industries. In the scope of this chapter, the utilization of lignin in manufacturing polyurethane foam and the effect of properties of polyurethane foam has been covered. Polyurethane foams are important products for the production of polyurethanes, such as hard, semi-rigid and soft foam types. Rigid foams are chiefly employed in furniture, coatings, adhesives and other applications. Flexible and semi flexible foams are extensively used in the automotive sector for seating cushions, bumpers and sound proofing properties. Rigid polyurethane foam with lignin addition provides high insulation and mechanical properties for the building, automotive industry, freeze industry, and naval applications with improved moisture and flame resistivity.