Psoralea corylifolia (Fabaceae), commonly known as “Babchi” or “Bakhuchi”, is an annual herbaceous species with a significant role in the traditional systems of Indian medicine. In the Unani system of medicine, Babchi has a long history of use for treating psoriasis, leukoderma, leprosy, and inflammatory skin diseases. The plant is rich in bioactive coumarins, flavonoids, meroterpenes, alkaloids, and essential oils that explain the diverse range of pharmacological effects, including antioxidant, anti-inflammatory, hepatoprotective, antidiabetic, and skin-protective effects. The main bioactive coumarin is Psoralen. This chapter reviews the latest research and provides a comprehensive understanding of the taxonomic, ethnobotanical, traditional, phytochemical, pharmacological, toxicological, as well as cultivation aspects of this plant species.